Find the week that the most volume of Luna burning happened. What caused this event? Show some effects of this burning had on Terra ecosystem by your opinion.

First, let's take a look at the weekly $LUNA burned this year thus far. From graph below, we can see that ninth week of 2022 (Feb 21st to Feb 27th) has the highest volume of $LUNA burned with over 12M $LUNA burned in that week.

We have to remember that 1 USD worth of $LUNA will be burned in order to mint 1 $UST so;

-at $50 $LUNA price, 10 $LUNA needed to mint 500 $UST

-at $100 $LUNA price, 5 $LUNA is needed to mint 500 $UST

so less $LUNA is needed to mint $UST at higher price compared to lower.

From daily $LUNA burned vs $LUNA price below, we can see that on 9th week (21/2 to 27/2), the price of $LUNA was at bottom $49 on 20/2 and it began the bull price action and on 27/2, $LUNA trading at $76. So there was 55% increase in $LUNA price that week hence lead to high volume of $LUNA burned that week.

We also can see the daily burn transaction count and address count increase in that period as seen in bar chart below. This could be due to users want to take profit on their $LUNA by burning their $LUNA and mint $UST.

Other than that, LFG also announced that closed a private token sale to various VC for BTC that will be used to strengthen the $UST peg as per tweet below. And graph below also shows the $LUNA balances of LFG address. We can see a reduction of almost 20M $LUNA on 16th Feb which could lead to the high burning of $LUNA in the following week.

Graph below shows the $UST supply which has seen a surge since 21st February. Many Lunatics view the increasing $UST supply as bullish catalyst for $LUNA, mainly because of the so-called UST-LUNA token model. In detail, Terra preserves UST’s peg of USD through an elastic monetary policy. So when the value of UST goes above $1, Terra incentivizes its users to burn LUNA and mint UST.

But when the UST supply contracts, LUNA valuation decreases due to a slowdown in the burning mechanism. All and all, LUNA's valuation tends to rise alongside UST's supply.

In conclusion, the unique UST-LUNA token burning and minting mechanism has been very unique especially as a native layer 1 tokens. The growth of $UST supply will give higher valuation on $LUNA. Stablecoins have drawn a lot of scrutiny over whether the issuers have enough collateral to back the price and what assets ensure the value of the coins. Algorithmic stablecoins do not have any collateral by design and for $UST, it has worked as designed so far.

As for the effects of the burn, we can spot higher transaction activity of bridging $UST through Wormhole and Terra Shuttle, and $UST deposit into Anchor Earn towards the end of February.