This recent crash is similar to the Luna collapse in that both occurred when major exchanges began accepting illegal stablecoins as high LTV collateral, causing risks to permeate between exchanges. One was UST, the other is USDe. The "stability" + high collateral ratio confused most people. Introducing illegal stable assets as collateral typically involves two approaches: First, allowing a high collateral ratio (90%+), but setting deposit/loan limits and a hard price anchor (like 1, or the price of USDT/USDC). This is a common practice in DeFi lending protocols. However, this approach can backfire, leading to situations like UST's collapse, where the protocol has to bear all the bad debts. Second, adopting market prices (liquidity risk) for pricing, but establishing a lower collateral ratio (50-70%), treating it as a volatile asset. The worst combination is using market prices for pricing while allowing a high collateral ratio; coupled with the fact that CEX itself does not have a fully open arbitrage environment, leading to low arbitrage efficiency and further amplifying risks. LSD-type assets face the same problem. These types of assets are essentially volatile assets disguised as "stable."