Luna/USTerra, – Back dollars with Bitcoin, they went bankrupt as soon as there was a bank run.
Tether, print USDT tokens, sell for dollars, use that money to buy Bitcoin. “USD” tokens are now backed by Bitcoin. Rinse and repeat.
Microstrategy, buy Bitcoin, issue convertible note “tokens” and sell for USD, use that money to buy more Bitcoin. USD tokens/notes are now backed by Bitcoins. Rinse and repeat.
The real question is how the tether scheme appears to be perfectly legal, since microstrategy appear to be doing it in plain sight on a publicly traded company. They have created a Bitcoin backed USD “stablecoin” that pays yields to holders.
The SEC is acting as if they would do something about LUNA/USTerra if they could go back in time, but Microstrategy is extremely similar, and the SEC doesnt care one bit.