The LUNA/UST algorithmic stablecoin pair was designed to maintain the peg of UST to the US dollar by using an algorithmic mechanism that adjusted the supply of both LUNA and UST in response to market demand. When the market price of UST was above $1, the algorithm minted new UST and sold LUNA to buy back UST, increasing the supply of UST in circulation and bringing its price down. When the market price of UST was below $1, the algorithm burned UST and bought back LUNA with the proceeds, decreasing the supply of UST in circulation and bringing its price up.

The "death spiral" was a potential risk that could occur in algorithmic stablecoins, including the LUNA/UST pair. It referred to a situation where the price of the stablecoin fell below its peg to the underlying asset (in this case, the US dollar) and triggered a self-reinforcing feedback loop that drove the price of the stablecoin further down.

In the case of LUNA/UST, if the market price of UST fell below $1, the algorithm would start selling LUNA to buy back UST in order to increase the supply of UST and bring its price up. However, if the price of LUNA fell faster than the algorithm could buy it back, the value of the collateral backing UST would decrease, which could trigger a liquidation event. This liquidation event could cause a further decrease in the value of LUNA and a further decrease in the value of UST, which could trigger additional liquidation events in a self-reinforcing feedback loop.

This is exactly what happened in May 2022. It started relatively mildly in the First week of May. In less than a month, the value of UST had dropped to less than 1 cent ($0.0065) and the value of LUNA had taken the real beating - dropping to prices as low as $0.000075 - an astonishing 99.99993% down from an all time high of approximately $116 (April 2022 - only one month prior to UST depeg)