From what I understand that 20% was completely legit and made sense. It simply came from a reserve that was created to attract investors, and as soon as that reserve were depleted, those returns would be gone.
I've not read all of anchor's material but I don't recall them publicly stating that the 20% APY was only going to las till they had burned through a specific amount of money. Do you know, was that stated publicly?
There is not a 21 day lock up for pulling funds out.
The Terra blockchain is a proof of stake blockchain where you can stake Luna in order to gain rewards from various fees the network collects. Unbonding your staked Luna takes 21 days to complete.
One of the assets which you could use as collateral on Anchor is bLuna. bLuna is a token that represents a Luna that is currently being staked. Anyone who holds bLuna is able to redeem the rewards that staked Luna has accrued since it was last redeemed. When you give it to Anchor as collateral Anchor will start paying it's depositors with those rewards. It is possible to convert a bLuna back into Luna, but this takes at least 21 days to complete as the unstaking process takes 21 days itself. If you don't want to wait that long you can just sell the bLuna to someone else for Luna.
