Conference Agenda

EFA General Assembly

The EFA 2023 General Assembly will be chaired by EFA President, Xavier Vives. 

Prize Ceremony

During the Prize Ceremony the following recognition will be awarded:

• EFA Honoree Awards
• Conference Awards
• Review of Finance Awards
• Doctoral Tutorial Award

Keynote Address

Professor Antoinette Schoar will be the Keynote Speaker at the EFA 50th Annual Meeting.

Anatomy of a Run: The Terra Luna Crash

Terra, the third largest cryptocurrency ecosystem after Bitcoin and Ethereum, collapsed in three days in May 2022 and wiped out $50 billion in valuation. At the center of the collapse was a run on a blockchain-based borrowing and lending protocol (Anchor) that promised high yields to its stablecoin (UST) depositors. Using detailed data from the Terra blockchain and trading data from exchanges, we show that the run on Terra was a complex phenomenon that happened across multiple chains and assets. It was unlikely due to concentrated market manipu-lation by a third party but instead was precipitated by growing concerns about the sustainability of the system. Once a few large holders of UST adjusted their positions on May 7th, 2022, other large traders followed. Blockchain technology allowed investors to monitor each other’s actions and amplified the speed of the run. Wealthier and more sophisticated investors were the first to run and ex-perienced much smaller losses. Poorer and less sophisticated investors ran later and had larger losses. The complexity of the system made it difficult even for in-siders to understand the buildup of risk. Finally, we draw broader lessons about financial fragility in an environment where a regulatory safety net does not exist, pseudonymous transactions are publicly observable, and market participants are incentivized to monitor the financial health of the system.

Authors: Jiageng Liu, Igor Makarov, and Antoinette Schoar.