What changed
Terra: the peg was the design, and the design failed.
The paper's thesis was that a dollar token could be held by arbitrage against the system's own token. Practice showed that defence and crash can be the same trade.
Original thesis
Mint the dollar token by burning LUNA. Burn the dollar token by minting LUNA. Arbitrage was supposed to hold the peg.
What changed
In May 2022 the peg broke. The mechanism that expanded LUNA to defend UST increased the supply of the asset the peg depended on. The paper remains a design. The live system is a failure case.
What remains useful
Any stable design that leans on a token of the same system should be read against this outcome. Reserves and over-collateral are different objects.