Sort of, I believe they count anything they put in their burn address towards the 'overcollateralization' - but my point is also that redemptions are turned off. No matter how much collateral they have there's no mechanism to turn 1USDD into 1USD worth of any collateral at all. Conducting open market operations (buying up USDD in the market) is significantly cheaper than redeeming them. Last I checked it would cost about $30M to restore the peg in open market operations.
Yeah, you are correct. The downward spiral mechanism is allowlisted, and the players won’t bring this event.
I have no love for HE, but indeed it is a pretty clever play to monetize HE’s illiquid shitcoins. Ive always deeply distrusted HE but I may have underestimated him.
