International currency exchanges certainly do not operate like un-insured banks.
If they did, no one would do business with them.
Coinbase has FDIC insurance on USD deposits.
Crypto deposits there are insured 100% by Lloyd’s of London.
Cryptoassets are volatile and this insurance is against fraud or malfeasance, not the loss of value.
A stablecoin like USDC is 100% backed by US dollar deposits and equivalents such as US treasuries. There are regular audits and attestations by a major accounting firm of the holdings.
UST was collateralized only by the value of the LUNA token, and no other collateral behind it. Unlike, say, Ethereum, there wasn’t anything else to do on the Terra/LUNA network except a few Ponzi finance apps.
I am a crypto investor and enthusiast (I have other investments- I’m an old guy compared with the median age in crypto). I’m happy to see the LUNA bubble pop, even if it takes some of my investments down for a while.
What’s unfortunate is that many people, including a few friends, were hit hard by this. I did try to warn them and was very negative about LUNA in a constructive way. Markets are humbling for everyone.