Saqib Iqbal
The hashtag Luna burn is trending on Twitter. Terra Luna, Terraform Labs’ volatile cryptocurrency, experienced a 100% pump over the weekend.
It is interesting to note that Terra Luna lost 100 percent earlier this month after the stablecoin TerraUSD lost its peg, causing billions of dollars of investors’ assets to be destroyed and bringing the stablecoins under regulatory scrutiny.
From its catastrophic lows valuing it at a fraction of 1 cent, the LUNA price is up 100 percent from it over the weekend and is still up 60 percent as of 6 AM GMT Monday on CoinMarketCap.
Is there a reason for such a rapid rise in the token’s value? Below are a few possibilities
What’s the terra Luna burn?
Do Kwon proposed to burn the Terra Luna token and cap supply at one billion as part of a plan to revitalize the Terra ecosystem. When cryptocurrencies are burned, they are removed from circulation. In turn, their total numbers in circulation are reduced. Wallet addresses, which can only be used for receiving krypton, are delivered with tokens. If the wallet is offline, the tokens will not be usable.
With a market capitalization of over $1.2 billion, Terra LUNA is currently trading at $0.0001912 at the time of writing. In response to allegations and questions from Terra employees, Terra founder Do Kwon came on Twitter the day before, which seems to have calmed the market on LUNA. Since then, the hashtag #Lunaburn has been trending.
If you still want to buy terra LUNA despite the risks, then it’s not too late to jump in.
Revival Plan 2 seems to be approved
The current Terra Network rejuvenation proposal has only two days left: Rebirth of the Terra Builders Alliance. A fresh idea proposes that a new Terra network be built without the UST algorithmic stablecoin.
Terra Classic (with LUNC token) is the primitive chain, whereas Terra New is the fresh chain (LUNA).
Cryptoassets are a highly volatile unregulated investment product.
Shorting Terra Luna can be difficult
Terra Luna’s value may have increased due to difficulties traders face when it comes to downsizing their holdings. Most cryptocurrency exchanges have blocked the Terra Luna logo from margin trading, making shorting the token impossible.
A short-term trade involves borrowing and selling an asset at a high price, then buying it back at a low price. It involves making a profit from the price difference.
Terranet hard fork
In addition to strengthening the Terra Network, Do Kwon, the founder of Terraform Labs, suggested moving the Terra Luna token to the new network.
More than 80% of users endorsed a “hard fork” in response to this proposal. Perhaps this was what caused the bulls to trigger over the weekend.
Where to Buy LUNA Now
The crypto exchanges where LUNA can currently be bought now include:
Cryptoassets are a highly volatile unregulated investment product.
Read more:
This article was written for Business 2 Community by Saqib Iqbal.
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‘Do Kwon proposed to burn the Terra Luna token and cap supply at one billion as part of a plan to revitalize the Terra ecosystem.’
This article is factually incorrect. Do Kwon has actually proposed to create a hard fork of Terra Luna, and mint a fixed one billion tokens on the new fork which will be named Terra Luna. These tokens will be completely new. The majority are set to be distributed to existing holders prior to the crash. A very small percentage will go to people holding during a snapshot to be taken on the 27th May.
He is not proposing to burn the existing Terra Luna tokens to reduce the supply to one billion. The existing 6.5 trillion Terra Luna tokens (or thereabouts) are set to become Terra Luna Classic and operate alongside the new Terra Luna.