Matt Williams
Footage of Do Kwon has emerged where the Terraform Labs CEO states ‘Terra will go to nothing’, and ‘I feel like the Bitconnect guys.’
He appears to be joking and has a reputation for humor on social media, although some Terra (LUNA) investors and noted figures in cryptocurrency have criticized his choice of words.
The new video footage follows on from previous accusations of LUNA being a ponzi scheme alleged by professional trader @AlgodTrading early in March, two months prior to the Terra crash.
Is LUNA a Ponzi Scheme
In the first clip Do Kwon states:
‘It’s a cycle of life – you begin from nothing and go back to nothing. That’s where I want to be. I think Terra’s going to be the decentralized money standard across the entire blockchain, and I’m excited for Terraform Labs to contribute a significant part of that early vision, but eventually to go back to nothing.’
In the second video Do Kwon leads a crowd in a chant of ‘UST, UST, UST’ (the ticker symbol of stable coin TerraUSD). It appears similar to multi-level marketing conferences and 2017 footage from the Bitconnect ponzi scheme, which he then references on stage.
Both videos originally shared to Twitter by @charlestrussel appear in the video below.
Terra LUNA was first launched and listed on Binance in August 2020, opening at $0.53 before reaching an all time high in April 2022 of $119.55.
It then lost over 99.999% of its value in a drop being compared to the Bitconnect crash and price collapses of other ponzi schemes like Plus Token.
It has since bounced from its low of 0.00000112 against BUSD, one of the trading pairs to have relisted the coin, to as high as $0.000595, then retraced to a LUNA price today of around $0.0002. There was a split second wick to $0.002 where someone market bought with slippage.
Anchor Protocol
Users of Anchor protocol were earning a high yield of 20% APY in return for staking their holdings of TerraUSD (UST). Users of Bitconnect were also enticed by a high interest rate during the 2017 crypto bull run until it collapsed in early 2018.
That value of that stablecoin is has also lost its 1:1 peg to the US dollar and is currently trading at $0.12, an almost 90% loss.
Terra Recovery Plan – Hard Fork to Terra Classic
It remains to be seen if the label scam or ponzi is accurate for Terra (LUNA) – it was previously a well-respected top 10 crypto asset with a $40 billion market cap – today at $1.3 billion.
LUNA trading is yet to be relisted on all crypto exchanges, for example eToro which delisted it at $0.0099, protecting traders from a further LUNA crash has not yet resumed trading.
Update – eToro decided to relist Terra (LUNA) on May 19th.
Cryptoassets are a highly volatile unregulated investment product.
The official explanation for the LUNA crash is that it fell victim to a co-ordinated attack, and an exploit that resulted in a hyper inflation of its circulating supply, which is now 6.5 trillion LUNA tokens.
LUNA Classic
Do Kwon has suggested a Terra 2.0 hard fork as part of his LUNA and UST recovery plan.
In a 12 tweet thread his proposal is for the Terra blockchain to be forked into a new chain without algorithmic stablecoins still called Terra, with the old chain being renamed to Terra Classic (LUNC) – reminiscent of Ethereum Classic – which will coexist alongside it.
‘LUNA Classic’ is now a trending topic on Twitter.
The LUNA Foundation Guard has also reportedly spent most of its Bitcoin reserves in an effort to stablilize UST and restore its peg.
Will LUNA Recover
A Terra LUNA price forecast for the future is difficult to predict after this black swan event. However if a large part of the inflated LUNA supply in circulation is not burnt, the LUNA market cap would already be back to $40 billion at a LUNA price of just over half of one cent ($0.006).
It would flip Bitcoin’s market cap ($578 billion) just before it reached nine cents ($0.09). So in terms of will LUNA recover to over $100 again – it’s only realistic if a LUNA crypto recovery plan is successfully implemented that includes burning most of the LUNA supply.
Shiba Inu has a circulating supply much higher than the LUNA crypto asset – 549 trillion. SHIB still has a market capitalization of $6.9 billion. So it is still possible to pump with such a high supply, as we saw with SHIB in October 2021.
The LUNA price now is trading at approximately $0.0002.
Crypto News
- LUNA Recovery Plan Updates
- Which Coins to Buy after May Crypto Correction
- Metaverse Cryptos Recover First after Crypto Dip
Cryptoassets are a highly volatile unregulated investment product.
This article was written for Business 2 Community by Matt Williams.
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