Posted on

Analyst Predicts Terra LUNA To Surge By 80-100% Following Key Event

LUNA, the native token of the Terra 2.0 blockchain, was among the many gainers in the past week positively affected by Bitcoin’s impressive rally toward the $35,000 mark.

According to data from CoinMarketCap, LUNA is up by 13.96% in the last seven days, providing some relief for investors who have had to endure the token’s bearish form in the previous weeks leading to this price rise. 

As expected, LUNA’s current bullish form has now attracted much attention, with some analysts speculating there could be more gains in the coming weeks. 

LUNA Could Double Its Value After Breaching Major Trendline, Analyst Says

In a post on X on Sunday, crypto analyst Captain Faibik shared with his 67,000 followers an intriguing bullish prediction on LUNA’s price trajectory.

Faibik, who claimed to not be a LUNA enthusiast, noted that the altcoin has recently broken a major bearish trendline and could potentially gain by 80-100%.

According to Faibik’s analysis, LUNA traded above $0.47 in the past week, breaching a bearish trendline that stretches as far back as January 2023 on the token’s daily chart.

Traditionally, trendlines are used by traders to connect several price points together and provide some insight into the potential direction of an asset’s price movement. 

When an asset’s price moves out of an established trendline, as in the case of LUNA, it can be interpreted as an impending price reversal.

Since the start of 2023, LUNA has produced an overall negative price performance, losing over 63% of its value in the last 10 months. However, if Faibik’s prediction proves true, the popular altcoin could be on its way to a remarkable recovery. 

At the time of writing, LUNA trades at $0.468 with a 0.70% decline in the last day. With an 80-100% price increase, this price could rise as high as $0.934 in the coming weeks.

Meanwhile, LUNA’s daily trading volume is currently down by 3.73% and valued at $48.67 million. With a market cap of $263.92 million, LUNA is ranked as the 117th largest cryptocurrency.

Related Reading: Is Terra Classic Planning For USTC To Be Pegged To The Dollar Again?

Terra Community Approves New Proposal 

In other news, the Terra Community has recently passed governance proposal 4790 aimed at the active and aggressive development of the Terra ecosystem with resources provided by Terraform Labs.

Under this newly approved proposal, Terraform Labs, alongside Terra community partners, will explore opportunities to utilize non-LUNA capital in driving the growth of the project’s economy. 

In addition, 125 million LUNA will be staked by a Terra community council to encourage and reward active network engagement, offer essential services to support the ecosystem, and guarantee equitable decentralization.

LUNA

Posted on

Terra Reacts To Case Against Do Kwon, Claims Matter Is Highly Politicized

The collapse of the algorithmic stablecoin Terra and its native token LUNA remained a shocking event in the crypto space. The outcome was the loss of billions of dollars for many individual and institutional investors. It also threw the entire crypto industry into a historic crisis. Lots of changes have taken place following the fall of the stablecoin.

Subsequently, some investigations and legal cases have been against the founder of Terraform Labs, Do Kwon. Firstly, the South Korean Prosecutors leveled some allegations against the Terra Chief.

Also, the International Criminal Police Organization (Interpol) issued a Red Notice against him. The Interpol request is for law enforcement’s immediate arrest of Do Kwon globally.

There was a massive loss of over $60 billion of investors’ funds through the fall of Terra and its ecosystem in the first half of the year. The South Korean Prosecutors requested the assistance of Interpol for the arrest of Kwon.

The prosecutors accused the Terra chief of hiding to avoid their investigations. According to a source, Kwon was seen in Singapore, though the city police noted that he later left.

Terra Says Case Against Kwon Is Highly Hyped Up

Following the alert from Interpol, there was a slight fall in the prices of Terra Classic (LUNC) and the newly launched Terra LUNA. Some rumors have been that Kwon went into hiding since the collapse of Terra and its ecosystem.

LUNA Price grows l LUNAUSDT on Tradingview.com

Terraform Labs has finally reacted to the case against Do Kwon. The firm stated that the case is highly politicized while speaking to Bloomberg. The spokesperson mentioned that the South Korean Prosecutors’ steps depicted unfairness in all aspects.

According to the spokesperson, the prosecutors failed to adhere to the basic rights available under Korean Law. Also, he noted that the prosecutors’ allegations against Kwon of breach of capital market laws indicated reasonable bias.

Featured Image Pixabay, Charts From Tradingview.com

Posted on

Do Kwon Statement: A Possible Trigger For Terra Tokens Price Surge

The collapse of the algorithmic stablecoin Terra and its ecosystem in May 2022 created a massive crisis in the crypto space. Coupled with the extreme crypto winter, the industry witnessed massive losses. As a result, billions of dollars were lost, and many investors lost faith in crypto.

Gradually, the space is experiencing a revival as several crypto assets and firms are picking up their shackles. The rebuilding and consolidation of value are slowly creating hope for some participants. In addition, the emergence of some events and activities in the industry could bring cryptocurrency a more robust atmosphere.

Terra had staged its comeback with the launch of Terra Classic (LUNC) and the recent rollout of Terra (LUNA). However, the LUNA ecosystem is still swinging under the balance as more allegations are piled on Do Kwon, the co-founder of Terraform Labs. Kwon was accused of being on the run since the fall of the LUNA ecosystem.

Kwon Reacts To The Allegations Of Hiding

However, the Terra chief took to Twitter recently to clarify the allegation of his hiding from the authorities. He said he had not made any effort to hide anywhere, explaining that he had been in public places like malls and on walks in the past weeks but didn’t run into anyone.

Recall that the International Criminal Police Organization (Interpol) issued a Red Notice officially against Do Kwon. This report caused the previous collapsed prices of Terra Classic (LUNC) and the recently released Terra (LUNA).

Also, there has been a previous report that Do Kwon may return to South Korea. This is because its Foreign Ministry passed the request to scrap his international passport.

According to the report, Kwon will have to be in his country within two weeks once the action is successful. Also, the South Korean Prosecutors disclosed the Interpol request worldwide for law enforcement to arrest Do Kwon on sight.

Reacting to Kwon’s Twitter post, a user asked the Terra Chief his opinion regarding the Interpol Red Notice. Kwon responded that he had searched for it on their website but had not seen such.

Possible Reasons For Terra Token Price Surge

Following Kwon’s statement, the Terra tokens’ performance has been impressive. But that’s the entire reason for the surge. In addition, the global leading crypto exchange, Binance, indicated its support for the Terra burning mechanism.

The exchange will burn a percentage of all trading fees on the spot and margin trading pairs of Terra Classic. LUNC burn address will receive the burnt rates.

In a 24-hour space, Terra Classic (LUNC) made a 61% reclaim of its value. Also, its trading volume spiked by 250% to hit $2.29 billion over the past 24 hours.

LUNA price surges on the chart l LUNAUSDT on Tradingview.com

Similarly, the recently launched Terra (LUNA) recorded a positive trend within 24 hours. The price climbed by 30% as its average trading surged to $2.68. Also, the trading volume is at $730 million, showing a rise of about 204%.

Featured image from Pixabay, Chart: TradingView.com

Posted on

How This Company Lost 99% Of Its Clients Funds Shorting LUNA

Per a report from Sedaily, the trading arm of Korean startup Uprise has lost of all its clients’ funds. The platform was used by wealthy individuals and institutions to trade crypto futures contracts via an artificial intelligence (AI) tool.

Related Reading | Altcoins Take The Lead As Bitcoin Struggles To Hold Above $20,000

According to the report, Uprise advertised its AI trading tool as high operational stability and a high-risk management alternative. In addition to losing its clients’ funds, the company was reported to record a loss of around $30 million from its own capital.

Uprise operates an AI trading platform and a crypto exchange platform. Users are encouraged to deposit cryptocurrency to trade with Uprise’s tool or to earn an annual percentage rate (APR) by holdings the assets on the exchange.

The local news media claims the platform is yet to inform its clients about the alleged massive loss. The report claims the trading AI placed several short positions on the failed cryptocurrency LUNA and was negatively impacted by the market volatility.

LUNA was Terra’s former native token which operated with a burning/issuance mechanism linked to the failed algorithmic stablecoin UST. Via the Anchor Protocol, Terra users were able to receive a 20% APR on their UST deposits.

Both UST and LUNA collapsed losing over 99% of their value in less than two weeks. Uprise is not the only firm negatively impacted by the collapse of the Terra ecosystem.

The fallout forced crypto hedge fund manager Three Arrows Capital (3AC), crypto lending company Celsius, BlockFi, and others to liquidate their LUNA positions recording millions of dollars in losses. As a consequence, the crypto market has experienced a steeper downside.

The report adds that Uprise “explained” and “informed” their users “in advance” about the high-risk nature of their product and about the “high possibility of a loss of principal” capital. However, South Korean regulators and law enforcement agencies could increase their scrutiny of the digital asset class.

Crypto Markets Still Recovers From LUNA Collapse

The South Korean startup apparently failed to register as a Virtual Asset Service Provider (VASP). Thus, it might have incurred an illegal action.

At the time of writing, there are no official statements from South Korean authorities. Uprise did confirm Sedaily’s report. A spokesperson for the platform said:

It is true that damage to customer assets has occurred due to unexpected great volatility in the market. We plan to finalize the report on virtual asset business soon,

The report claims the company might need to compensate its customers due to their losses. South Korean authorities have been investigating the events that led to the LUNA collapse. Thus, why the startup could take some heat if it is unable to make its clients whole.

Related Reading | Bitcoin Approaches 2018 Like Drawdown, Why $20,000 Is A Crucial Level

At the time of writing, BTC’s and larger cryptocurrencies are still trying to reclaim higher levels. The Terra fiasco might put more pressure on digital assets as other companies like Uprise come to light.

Crypto total market cap trends to the downside amid LUNA’s collapse. Source: LUNAUSDT Tradingview

Posted on

LUNA2 Records Losses as Market Rebounds, Investors Lost Faith?

A couple of days after its launch, the new LUNA or LUNA2 token from the Terra network continues to experience high volatility levels. The cryptocurrency was deployed as a result of the collapse of the old LUNA or LUNA Classic which lost almost 99% of its value in a little over a week.

Related Reading | Ethereum’s Optimism Airdropped Governance Token, Here Is How It Went

This resulted in billions of dollars in losses for retail investors as the Anchor Protocol, the platform which promised stablecoin UST stakers a 20% annual percentage return (APR), and the whole Terra ecosystem enjoyed high popularity.

At the time of writing, LUNA2 trades at $6.65 with a 7% loss in the 4-hour chart. The cryptocurrency was able to reach as much as $10 at its high but could continue to experiment with downside volatility.

LUNA2 is trending to the downside on the 4-hour chart. Source: LUNA2USDT Tradingview

Data from Material Indicators (MI) hinted at further losses when the price reached its all-time high. Based on the Trend Precognition indicator for the daily chart, LUNA2 could re-test support levels.

The crypto market might play against any potential recovery. The largest cryptocurrencies, such as Bitcoin and Ethereum were recording gains during today’s trading session after weeks of sideways movement.

Bitcoin was almost 9%, but all the profits have been lost in lower timeframes. The number one crypto by market cap could return to its recent range of around $28,000 to $30,000 if the bulls are incapable of pushing back against the increased selling pressure.

Analyst Ali Martinez identified $29,800 and $28,600 as the next area of interest for any potential support. LUNA2 traders could benefit from a relief bounce in these areas but might see further downside action in the short term.

#Bitcoin got rejected by the 200MA on the 4hr chart as anticipated!

Now, $BTC is testing the $30,750 support level. Failing to hold above it could send #BTC to the next areas of support at $29,800 and $28,660.

Only a sustained close above the 200MA can send prices to $34,750. https://t.co/Kb49f4Krn1 pic.twitter.com/YHwfKvhX4o

— Ali Martinez (@ali_charts) June 1, 2022

As part of the creation of LUNA2, previous LUNA holders are entitled to an airdrop. This measure was aimed at mitigating part of their losses and providing them with a tangible solution. However, some critics believe the initiative will be insufficient and could contribute to the downside price action as users receive and dump their tokens on the market.

Users Express Concerns About Exchanges Supporting LUNA2

Before its launch, there were a lot of doubts about the future of any new LUNA token. When the price of the original cryptocurrency collapsed below $0, crypto exchange platforms rushed to remove it and terminated any trading positions with LUNA, for the benefit or detriment of the trader.

Now, the same platforms have been supporting LUNA2. Many users have been calling out these venues as they consider the token could follow LUNA’s trajectory into oblivion.

Jesse Powell, CEO at crypto exchange Kraken, addressed these concerns. He said the following on the LUNA2 and LUNA:

I don’t necessarily see them as related. Is there a technical takedown of LUNA2? Does LUNA2 have the same flaws? I’m not an expert on the coin but presumably LUNA2 has learned something from LUNA. Is supporting LUNA2 and the airdrop improving the situation for LUNA holders?

Related Reading | LUNA 2.0 Suffers Significant Price Correction Hours After Launch

In addition, Powell claimed the LUNA crash might have been the cause of “incompetence” rather than a “scam”, as many critics believe. In that sense, he claims listing a cryptocurrency is different from endorsing it and added: “All assets have risk”.

Posted on

How Early LUNA Holders, Founders Made Off With $6B

The Terra (LUNA) crash will go down in crypto history as one of its most catastrophic events. Billions of people lost their life savings and investments. In the meantime, a small group of insiders benefited.

Related Reading | LUNA Classic Jumps 90% Following Support From Crypto Exchanges

According to a report from Arcane Research analyst Anders Helseth, the Terra (LUNA) ecosystem, now known as Terra Classic, operated as a long-term “pump and dump” scheme.

The analyst looked into on-chain activity to support his claims and found revealing information on the distribution of LUNC and its value inflows, how the token supply moved from one group of addresses to another, from exchange platforms from 2020 to a few days before the crash.

The analyst called the Terra Classic ecosystem the “perfect exit liquidity” for early LUNA holders. This scheme was supported by the high popularity in the Anchor Protocol, the UST (Terra Classic’s algorithmic stablecoin) and LUNA mint mechanism, and this token’s supply.

As seen below, the LUNA supply was “highly concentrated” by Terraform Labs (TFL), Terra Classic’s developing company co-founded by Do-Kwon. Excluding exchange platforms, TFL controlled over 537 million LUNA tokens as of October 3, 2020.

Source: Arcane Research

The analyst claims unidentified wallets founded by Terraform Labs, the largest LUNC holder, moved their funds to “bridges and centralized exchanges”. The funds began moving in late 2020 and “frequently” saw transactions from TFL to as many as 3,000 unidentified wallets.

A total of $6 billion in net outflows were recorded between Terraform Labs to these wallets to bridges/exchanges. As seen below, these funds were later transferred to the “others” group of wallets.

In other words, according to the analyst’s research, Terraform Labs seemed to have moved their LUNA supply to exchanges where they were bought by retail investors. The “others” wallets saw $6.5 billion in net inflows.

Source: Arcane Research
Did The LUNA Crash Made Billions To Early Investors?

In theory, $6.5 billion is the profit scored by TFL and early LUNC investors, but the analyst believes the number could be much higher. The report claims the following:

Therefore, we have reason to believe that the potential for creating outside profits was larger than the $6 billion net flow that’s calculated based on the assumption that portions of the early deposits of LUNAto exchanges were not sold.

Thus, the report claims the Terra Classic ecosystem, levering the popularity and the upside volatility on the price of LUNA (LUNC), created “exit liquidity” for these investors. The analyst concluded the following on the alleged mechanism that enabled early LUNC investors to transfer value to retail investors:

By pumping the LUNA token, the burn/mint mechanism, and creating a sustained demand for the UST token through Anchor, the perfect exit liquidity for large LUNA bags was created (…). At best, the profits can be described as collateral winnings in a failed bootstrapping attempt.

Related Reading | Daily Pump & Dump | May 31, 2022 Crypto Market Report

At the time of writing, LUNA trades at $9 with a 3% loss on the 4-hour chart.

LUNA trends to the downside on the 4-hour chart. Source: LUNAUSDT Tradingview

Posted on

LUNA Aftermath: Total Crypto Market More Oversold Than Black Thursday

Panic struck the crypto market last week when Bitcoin broke below support, stablecoins unpegged from the dollar, and LUNA dropped to zero. The bloody aftermath has left cryptocurrencies as a whole more oversold than the Black Thursday COVID collapse.

Here is a closer look at the historically oversold conditions in crypto.

Total Crypto Market More Oversold Than Black Thursday

It was a bloodbath in Bitcoin, apocalypse in altcoins. Even stablecoins pegged to the price of the almighty dollar were completely shaken. A nefarious actor or group of actors strategically attacked the dollar-peg of the UST stablecoin, causing a domino effect of algorithmically driven liquidation of reserve assets that included BTC.

Related Reading | This Expanding Triangle Pattern Could Be The Last Hope For Bitcoin Bulls

Bitcoin plunged through support and many altcoins reached a total drawdown of 80 to 90% or more. LUNA, an asset tied to UST, fell all the way to zero. Billions were wiped out from the total crypto market cap. If there was ever a time to be doubtful about the future of crypto, it might be now. However, market veterans recommend when things become doubtful, you zoom out.

The weekly RSI is more oversold than on Black Thursday | Source: CRYPTOCAP-TOTAL on TradingView.com

“When in doubt, zoom out,” holds true in this case. Comparing the recent crypto selloff with Black Thursday, the weekly RSI has reached even more extreme oversold levels. Meanwhile, the Black Thursday candle recorded a 50% drawdown, and the latest correction by contrast barely produced 30%.

By definition, a hidden bullish divergence occurs when an asset’s price sets a higher low, yet the indicator sets a lower low. This often indicates continuation ahead.

 

Elliott Wave Theory suggest the cycle isn’t complete  | Source: CRYPTOCAP-TOTAL on TradingView.com
Could Another 45% Collapse Still Be Ahead?

Elliott Wave Theory could provide clues as to what continuation might look like ahead. The total crypto market cap is also trading within a parallel channel, of which it just touched the bottom of. The upper boundary of the channel is roughly $10 trillion USD.

Related Reading | Bitcoin Bear Market Comparison Says It Is Almost Time For Bull Season

While that fact might be the hope bulls need right now, bears still could have the last laugh. The weekly RSI has now reached the lowest level since the bear market bottom and the fourth lowest in its history on TradingView.

Only three other times has the total crypto market cap been more oversold  | Source: CRYPTOCAP-TOTAL on TradingView.com

Of the three previous lows set on the weekly RSI, two were bear market bottoms. The remaining low, however, was followed by another 45% plunge to the final bottom. Another 45% drop from here would take the total crypto market cap back to around $600 billion, or below the January 2018 cycle peak.

Simply put, risk is still extremely high, but as oversold conditions increase, so does the potential for reward. Act accordingly.

Follow @TonySpilotroBTC on Twitter or join the TonyTradesBTC Telegram for exclusive daily market insights and technical analysis education. Please note: Content is educational and should not be considered investment advice.

Featured image from iStockPhoto, Charts from TradingView.com

Posted on

Why Terra’s Anchor Protocol Changed Earn Rate To 18% APY

Anchor Protocol, one of the most popular platforms in the Terra ecosystem, rolled out a change in its Earn Rate. The latter will begin to operate in a semi-dynamic fashion rather than the previously fixed 20% annual percentage yield (APY).

Related Reading | Terra Price Continues Moving North; How Soon Will It Cross $100? 

With a massive shift in the protocol’s reward mechanism, the new models aim at making Anchor “more sustainable”. As a result, users started earning an 18% APY as of yesterday, May 1. The earn rate will be modified each month for the foreseeable future.

The team behind this Terra project said the following via their official Twitter account:

The Anchor Earn rate adjusts dynamically by up to 1.5% each month based on if the yield reserve appreciated or depreciated. The floor is 15% APY & the ceiling is 20% APY.

The changes in Anchor’s earn rate are triggered by the protocol’s yield reserve. A .25% modification in this element will be followed by an adjustment in the Earn Rate.

This shift in the Terra protocol was approved, via Proposition 20, on March 24 this year. At the time, Anchor Protocol said:

The addition of a semi-dynamic Earn rate will contribute to the long-term sustainability of Anchor & will benefit users of the protocol by enabling yield reserve growth while continuing to provide an attractive yield on UST.

As seen below, the total borrowed versus total deposits on Anchor shows significant divergence. This is why the yield reserves on the protocol trend to the downside, especially in times of bearish price action on larger cryptocurrencies.

Source: Anchor Protocol

Some of the users believe that this trend could trigger a deppeging event for UST which could jeopardize the entire Terra ecosystem. The introduction of a semi-dynamic rate is the first step to avoiding this possibility.

Terra Is Not The Most Attractive Venue For Stablecoin Yield?

Some users believe that the new earn rate might not be enough and have been suggesting the implementation of investment strategies that can contribute to the yield reserves. Another part of the community seems focused on increasing the borrowing rate at Anchor.

However, as the chart above shows, deposits on the Terra protocol have been trending to the upside at a fast pace. In the meantime, the number of borrows has been moving sideways with a slight uptick in recent months.

Over the same period, other network launched their own stablecoins with alternatives to Anchor. NEAR and TRON stand out because of the hype and the APY that they are offering to their users.

TRON seems to have the largest incentives as it provides depositors with a 30% APY. Like Terra users with Anchor, many wonder if those rewards will be sustainable.

Related Reading | Terra Users Heads Up, Why NEAR May Launch Native Stablecoin With A 20% APR

At the time of writing, Terra (LUNA) trades at $83 with a 6% profit in 24-hours.

LUNA is on an upward trend on the daily chart. Source: LUNAUSDT Tradingview

Posted on

LUNA Moves On Its Own Beat, Bulls Aim For New ATH

LUNA continues to display strength as the crypto market trends to the downside. Despite the current short-term increase in selling pressure, this cryptocurrency managed to enter uncharted territory, and its price action hints at more upside.

Related Reading | Inside Terra’s $2.38 Billion Reserves, What Made The Lineup?

As seen in the chart below, LUNA has been on its uptrend since August 2021. It briefly dropped towards the $40 area and resumed its momentum to $120.

At the time of writing, LUNA trades at $87 with a 4% profit in the 4-hour chart. As Bitcoin and larger cryptocurrencies bleed under the pressure of a broad market downside, LUNA hints at the moon.

LUNA is on an upside trend on the 4-hour chart. Source: LUNAUSDT Tradingview

The long-term fundamentals behind this cryptocurrency’s increase are still in place. The Terra native cryptocurrency and its ecosystem have managed to attract new users due to its products and staking mechanism.

Two sides of the same coin, LUNA, and Terra’s stablecoin UST have taken over the DeFi sector. Recently, stablecoin became the third largest in terms of market cap.

Only surpass by USD Coin (USDC) and Tether (USDT) with over $50 billion in terms of market cap, UST reached the $17 billion market cap and displaced BUSD.

The increase in market cap could be interpreted as another metric of Terra’s adoption. The ecosystem has attracted attention due to its Anchor Protocol and this project’s 19% annual percentage yield (APY) for staking UST.

Data from Token Terminal measuring LUNA’s transaction volume (in pink in the chart below) confirms the rise of the Terra ecosystem. This metric stood at less than $50 million in April 2021 and reached an all-time high of close to $3 billion.

Source: Token Terminal

The increase in this metric seems to be correlated with LUNA’s price with an important uptick in November 2021, when the network saw the implementation of important updates.

LUNA Has The Fundamentals And Other Factors To Sustain Its Rally

As noted by a Terra user, the Anchor Protocol, probably one of the projects driven by LUNA’s current rally, continues to consolidate important partnerships and accessibility to different investment strategies. Recently, it announced deposits and withdrawals to the Mars Protocol’s Red Bank.

In addition, Anchor’s ANC was listed on Crypto.com, one of the largest crypto exchange platforms, as Terra increases its computability with other networks including Polkadot and Avalanche. The user noted this ecosystem’s milestones:

Anchor Protocol and Acala Network with help of Wormhole integrated to unite Terra, Polkadot DeFi ecosystems and to grow the decentralized stablecoin market. Hashed & Delphi Ventures co-lead seed round for Reactor Terra’s omni booster.

Related Reading | Terra Users Heads Up, Why NEAR May Launch Native Stablecoin With A 20% APR

Terra has also seen the deployment of new assets, liquidity pools, and the launch of the Terra Global Founder Fellowship program. This initiative is supported by Jump Capital, Hashed, Alpha Ventures, and others.

11🔸 @riskharbor redeployed a refreshed Ozone V1 Anchor $aUST protection pool. The capacity has increased by 200M.

12🔸 $UST is now available on https://t.co/Zeas4x8b3H Buy Crypto page. In addition, $UST / $USD and $UST / $USDT trading pairs are now live.

⤵

— Helen | Everstake (@helen_everstake) April 18, 2022

Posted on

LUNA Holds Ground Over $90, Do-Kwon Hints At Factors Behind Rally

LUNA, Terra’s native cryptocurrency, remains on an upward trajectory. The cryptocurrency follows the general market sentiment and is one of the best performers in the crypto top 10.

Related Reading | Terra (LUNA) Surpasses Ethereum Becoming Second Most Staked Asset

This trend could continue in the short term, but some indicators point to caution. In the long term, the outlook seems clearer.

At the time of writing, Terra’s cryptocurrency trades at $94 with sideways movement in the last 24 hours and 6% profit in the past week.

LUNA trends to the upside. Source: LUNAUSDT Tradingview

Do Kwon, Terra Co-Founder has become one of the most popular individuals in the crypto space. Very active on social media platforms, Kwon recently presented one bullish factor for the long-term survival of LUNA and the Terra ecosystem.

According to Kwon, the crypto market will increase its demand for decentralized stablecoins, making Terra’s native stablecoin UST grow further. This stablecoin and LUNA operate with a burning mechanism.

Whenever the demand for UST increases, the mechanism burns LUNA to increase the stablecoin’s supply and vice versa.

Unlike competitors, such as Tether (USDT) and USD Coin (USDC), UST is decentralized, as Kwon reiterated. This makes it less vulnerable to single points of failure, government censorship, and other external vulnerabilities.

This is probably the reason Kwon seems certain about UST’s future growth. Via his Twitter account, Kwon said:

UST ‘s grew because its sovereignty is the only sensible model to scale decentralized money.

The Anchor Protocol, a Terra native product, offers UST holders the opportunity to earn a 19% APY. This has been one of the most important factors behind the surge in demand for the UST stablecoin.

In less than a year, UST has climbed to the top 15 cryptocurrencies by market cap and to the number 4th position in terms of stablecoin market cap. If the demand for UST continues, the entire Terra ecosystem will benefit.

Source: DeFiLlama
LUNA Build To Withstand Crypto Winter?

The biggest concern about Terra and UST is Anchor Protocol’s capacity to sustain its APY, currently one of the highest in the market. Pedro Ojeda, a co-founder at SplitBrick, pointed out the mechanism to mint the stablecoin has been designed to protect Anchor:

Luna staking yields stablecoins+Luna. This has a beautiful property in which [ unlike ETH, BTC, AVAX etc whose staking return depends purely on coin price ] as Luna price drops, yield goes up naturally since (stablecoin+Luna)/Cheaper Luna = higher APR.

In the short term, Terra’s native crypto could face some hurdles to reclaim previous highs. Data from Material Indicators (MI) suggest small investors have been buying the recent rally.

Retail investors (yellow in the chart) buy the LUNA rally while larger investors sell (red in the chart). Source: Material Indicators

However, investors with asks orders of around $10,000 have been suppressing price action keeping LUNA in a tight range.

Bitcoin could be the key for future appreciation on lower timeframes. If the benchmark crypto can break above $43,000, LUNA and other altcoins could follow.

Related Reading | Mars Protocol To Launch On Terra, But Why MARS Has Seen A Massive Dump

BTC’s price faces its own difficulties with a TD Sequential indicator flashing a sell signal on the daily chart and with MI’s trend precognition pointing downwards on the same period.

Posted on

LUNA Sees 17% Loss In One Week, UST De-Peg Rumors Affect Its Price?

As the crypto market sees some relief over the past week, the price of LUNA trends to the downside. The worst performer in the top 10 by market cap, the Terra native cryptocurrency appears at risk of further downside.

Related Reading | What’s Behind LUNA’s Rally, Could Its Price Decouple From Bitcoin?

At the time of writing, LUNA trades at $87 with a 17% loss and a 5% loss in the last week and 24-hours, respectively.

LUNA with moderate gains on the 4-hour chart. Source: LUNAUSDT Tradingview

Data from Material Indicators (MI) suggest thin support for LUNA’s price at its current levels. Around $83 there are around $700,000 in bids orders which could proved inefficient to prevent a fresh assault from the bears.

In addition, Terra presents over $3 million in ask orders which could operate as major resistance as the price attempts to reclaim previous highs. As seen below, LUNA could fail to break above the selling wall around $86 due to the high amount of ask orders.

LUNA’s price (blue line) with important resistance (asks orders in yellow above price) at current levels. Source: Material Indicators

In the price is rejected around those levels, $81 should operate as the next support levels as it records around $2 million bids.

Additional data provided by analytics platform Nansen indicates the Terra ecosystem has seen important adoption levels. Trending upwards since 2021, the daily active address on this network stands near 35,000 and saw a small decline as the price of LUNA turned bearish.

However, daily transactions have been moving sideways with a small uptick towards 160,000 during March 2022. This could suggest investors are onboarding the network, but with low bids for LUNA or Tera’s native product.

Source: Nansen
Terra (LUNA) Expands, Why Bulls Could Have The Upper hand

The above suggest more sideways action with potential for downside pressure in the short term. Over the long term, Terra continues to generate interest.

Retail investors seem to be attracted to LUNA’s burning mechanism tied to the network’s native stablecoin UST. This digital assets also enable investors to generate a 19% APY with the Anchor Protocol.

Rumors over the sustainability of Anchor’s 19% APY have surrounded social media in recent days. Most likely driven by the bet between Do Kwon, co-founder of Terra Labs, and a pseudonym crypto trader known as Gigantic Rebirth (GCR).

The winner will be determined by the price of LUNA. If the cryptocurrency manages to stay above $80 in one year, Do Kown will win.

Beyond the bet and the price of this cryptocurrency, the event has cast doubt on the ecosystem. In defense of Terra, LUNA, and UST fundamentals developer José María Macedo published an analysis on this network.

UST operates as an algorithm and decentralized stablecoin. The DeFi sector has seen its fair share of this types of assets, often ending up in failure, but the Terra native stablecoin could follow its own trajectory. Macedo said:

$UST already defied the odds by not just surviving but thriving as a pure algo stable: growing supply, keeping a tight peg and withstanding shocks such as May ’21 What Terra achieved is truly unprecedented and few understand it (…). I’m bullish not because I think there are no risks, but because I understand the tradeoffs and believe the upside more than justifies the risk. Decentralized stablecoins are a multi-trillion dollar, winner-takes-most market that $UST is best positioned to win.

Related Reading | Terra (LUNA) Surpasses Ethereum Becoming Second Most Staked Asset

Recently, the Anchor Protocol was deployed on top of the Avalanche network. The price seems to be positively reacting to this event, but bulls need to secure current levels as support by closing a daily candle about $86 or above.

Posted on

What’s Behind LUNA’s Rally, Could Its Price Decouple From Bitcoin?

The price of LUNA moves on its own as the crypto market trends to the downside. Terra’s native cryptocurrency records a 6.4% profit in the last week, as BTC, ETH, and BNB, move sideways.

Related Reading | Mars Protocol To Launch On Terra, But Why MARS Has Seen A Massive Dump

At the time of writing, LUNA trades at $89.35 with a 4.8% loss in the last 24 hours. Despite recent losses, the cryptocurrency is quickly moving up the top 10 cryptos by market. Currently, it sits at the 7th position after pushing down Cardano (ADA), Solana (SOL), and Polkadot (DOT).

LUNA trends to the upside on the daily chart. Source: LUNAUSDT Tradingview

A report from economist Murray Rudd attempts to demonstrate a potential decoupling between Bitcoin (BTC) and Terra (LUNA). The number one cryptocurrency has a strong dominance over the entire market.

Therefore, it is common for altcoins to trend lower of higher, to move in tandem, with BTC’s price action. Recently, LUNA’s price has possible start to breakaway from this pattern, it sometimes tends to move on its own direction regardless of Bitcoin.

In order to support this thesis, Rudd examined the LUNA/BTC performance on different timeframes, and with different metrics. The economist represented this trading pair’s performance with different correlation zones.

As seen below, the green area represents a high correlation, while the red to white area represent periods when LUNA is uncorrelated (red) or shows a low correlation (white) with BTC. Based on this chart, Rudd said:

The degree of positive correlation appears to have dropped in duration and strength (i.e., more time spent in the weak positive correlation zone compared to strong correlation) from Aug 2021.

Source: Murray Rudd via Substack

Furthermore, looking into the LUNA/BTC correlation for a 30-day period from January 2020 to January 2021 the economist found moments when the metric moved with more visibility.

For example, the chart below shows a decline in correlation for the trading pair during Q4, 2020, when BTC began it ascend towards new highs. Conversely, the chart indicates LUNA tends to move on its own, at least for this period, after long period of BTC’s price consolidation.

Source: Murray Rudd via Substack
The Luna Decoupling, What It Means For Future Price Action

The economist also determined a first major period of uncorrelated prices for the LUNA/BTC trading pair during spring 2021. At that time, the crypto market reached a local top surpassing the $2 trillion in terms of capitalization.

Across 2021, Terra’s native asset will experience other uncorrelated or low correlation periods. When the crypto market started bouncing back from a long period of bearish price action, summer 2021, the LUNA/BTC trading pair “abruptly flipped from positive correlation to being uncorrelated”.

In September 2021 and December 2021, LUNA experience similar events. At that time, the ecosystem was discussing several major improvements to its mainnet, and the implementation of a burning mechanism for LUNA.

These updates and new mechanisms in the Terra ecosystem have been live for a short while. As time goes by, they could contribute with LUNA’s full decoupling from Bitcoin and the crypto market. Currently, Rudd believes this event may never happen, but he added:

LUNA price is not (and likely will not) completely decoupled from BTC price. This indicator cannot be used to predict future moves in correlation but it has definitively shown a significant decoupling of LUNA and Bitcoin prices since summer 2021.

Uncorrelated assets are potentially valuable for investors as they could become hedge against trends in the entire sector. In a bear market, investors could protect their wealth by jumping into a LUNA position or by using its stablecoin UST.

Related Reading | Terra (LUNA) Outperforms Popular Cryptos Ether, Dogecoin In The Past 24 Hours

The increase demand for this decentralized stablecoin, and its impact on the price of LUNA, is yet another reason that could further strengthen the long-term bull thesis for the Terra ecosystem.

Posted on

Mars Protocol To Launch On Terra, But Why MARS Has Seen A Massive Dump

Decentralized credit protocol Mars is set to launch today, March 7th, on the Terra ecosystem. One of the most hype projects in the crypto space, Mars will bring the financial services of a legacy financial institution without its tradeoffs.

Related Reading | Terra (LUNA), Quant (QNT) Pull Up As Avalanche (AVAX) Nosedives

In addition, users that interacted with the Mars Protocol are eligible to receive an airdrop of their governance token, MARS. At the time of writing, the token that will provide this protocol’s community with decision power over future proposals trends downside with high volatility.

Source: MARS/UST Coingecko

Nothing new for recently deployed protocols. However, some users have begun speculating about the possibility of early investors dumping their MARS tokens on future airdrop beneficiaries. On this matter, Delphi Digital’s José María Macedo said:

Unfortunately, nodes Mars Protocol, Astroport_fi and other Terra dApps connect to are down so nothing the team can do right now. As a reminder, all Mars initial contributors are locked until next year, so pls stop spamming about “inside job”.

Terra Co-Founder Do Kwon seems bullish on Mars Protocol long term development. Therefore, this recent price action could find support over the coming weeks and lead to potential price appreciation.

For yield farmers, the protocol seems to provide several passive income strategies which could attract long term investors rather than speculators. Over the next 3 to 18 months, as NewsBTC reported, users that lock Terra’s token LUNA will receive MARS as compensation.

Over 10 million MARS token will be distributed for early investors supporting the protocol. In addition, liquidity provider for the MARS/UST trading on AMM Astroport will receive a portion of the rewards over the coming 12 months. The team behind Mars Protocol said the following via their Twitter handle:

The Mars UI will shortly be released and rewards will be claimable. However, the Terra nodes Mars connects to are experiencing very high traffic which will cause elements in the interface to update slowly. Please be patient or try again later.

Terra To Provide Investors With More Yield Farming Opportunities

As clarified by the team behind Mars, the protocol will provide users with three additional “leveraged yield farming strategies”. Based on the stablecoin UST, and three different tokens LUNA, Anchor (ANC), and Mirror (MIR).

The three strategies operate with a similar mechanism, a user deposits one of the tokens on Mars and start earning rewards. However, ANC and MIR offer users 2x the rewards as their tokens are also deposit on Astroport to generate yield.

For example, a user deposits ANC on Mars and the protocols proceeds to borrow 100% of the tokens deposit in UST. Later, Mars’ smart contract takes the original ANC and UST and send them to Astroport to generate rewards in ASTRO.

The Fields contracts will automatically harvest these rewards multiple times per day and re-deposit them into your leveraged yield farming position.

— Mars Protocol (@mars_protocol) March 4, 2022

Related Reading | Terra (LUNA) Outperforms Popular Cryptos Ether, Dogecoin In The Past 24 Hours

Mars Protocol smart contract, dubbed Fields of Mars and with a deployment date set for the next 24 hours, will support the yield farming strategies. At the time of writing, the protocol has launched two features, depositing and borrowing. As they clarified via Twitter:

Depositing and borrowing $LUNA and $UST within the Red Bank and staking $MARS for $xMARS. Staking gives users access to governance via the Martian Council where they can create and vote on governance proposals.

Posted on

Why Terra Co-Founder Do Kwon Hyped Up This UST-based Airdrop

The Terra ecosystem keeps on expanding, increasing the total market cap of its native token LUNA. The cryptocurrency has managed to enter the top 10 digital assets by market cap replacing memecoins DOGE and Shiba Inu (SHIB).

Related Reading | Terra’s UST Becomes First Decentralized Stablecoin To Surpass $10B Market Cap

As of press time, LUNA follows the general sentiment in the market with a 4.4% loss in the last week, but some profits in lower timeframes. The Terra-based cryptocurrency trades at $49,58 and has seen much less loss than larger cryptocurrencies, such as Bitcoin and Ethereum, which record over 10% losses in the same period.

LUNA moving sideways on the daily chart. Source: LUNAUSDT Tradingview

Terra’s success seems supported by its protocol’s tool to provide users with vast opportunities to generate profits via staking or “locking down” their tokens. In that sense, the ecosystem’s stablecoin UST has also seen impressive growth zooming on Tether (USDT), and USD Coin (USDC), in terms of market cap.

Via his Twitter account, Do Kwon, Terraform Labs Co-Founder, mentioned a new use case that seems poised to increase the demand for UST. Lending and borrowing platform Mars protocol announced the start of its lockdrop which incentivizes users to lock their UST to receive rewards.

I’m coming in https://t.co/7jRgSEVR31

— Do Kwon 🌕 (@stablekwon) February 21, 2022

User will yield farm the protocol’s governance token MARS by locking any amount of the stablecoin for the next 3 to 18 months, as clarified in an official announcement. After this period is concluded, the user will be able to withdraw 100% of their initial investment. The team behind the protocol said:

All participants who lock $UST will receive a “drop” of fully transferable MARS governance tokens when the full protocol launches in ~2 weeks. As knowledgeable DeFi users with skin in the game, lockdrop participants will receive the vast majority of circulating MARS tokens at launch (around March 7).

Terra Enables More Yield Farming Opportunities

Created as an open-source, algorithm, and non-custodial credit protocol supported by its own governance model, the Mars protocol will distribute 10,000,000 MARS governance tokens to participants within the Terra ecosystem. The airdrop has the objective of helping Mars to “function properly”.

Source: Mars Protocol via Medium

In addition to those users locking their UST on the protocol, liquidity providers for the MARS/UST trading pair on the decentralized exchange Astroport will be able to earn a portion of 10,000,000 in the governance token for 1 year. This process will be post-launch and will include those users with UST deposits to the Red Bank.

Related Reading | Terra (LUNA) Holders Approve New Sports Sponsorship Deal

LUNA holders will benefit from this launch, as stated by the team behind Mars, with a one-time distribution on 10,000,000 MARS. In order to receive the airdrop, users needed to be stakers by January 1st, 2022, when a snapshot was taken to determine the beneficiaries. The announcement added:

Airdrop recipients will be able to claim their tokens for up to three months after the launch of Mars. Any unclaimed tokens will be returned to the Martian Council — a DAO of xMARS token holders.

Posted on

LUNA Drops 20% As Investors Panic, What Is The Link With Anchor And UST?

LUNA has been dropping sharply in the past few days, deeper than larger cryptocurrencies. As of press time, Terra’s native token moves on critical support barely above $50 with a 16.4% loss in the last 24 hours.

Related Reading | Terra Announces Non-Profit ‘Luna Foundation Guard’

LUNA on a downtrend in the 4-hour chart. Source: LUNAUSDT Tradingview

According to Wu Blockchain, the token lost as much as 20% in the last day. Apparently, retail investors have been panic selling their LUNA funds due to concerns about several of its dApps and UST. The latter is one of many stablecoins operating on the Terra ecosystem which is based on a supply and demand mechanism to maintain its peg.

As NewsBTC reported back in December, UST has been gaining relevance across the DeFi sectors. The stablecoin allows holders access to the Anchor Protocol, Terra-based lending and borrowing application that consistently offered its users a 19.5% compounding yield on their UST deposits.

This rate surpasses that of its competitors, some of which have issues offering a 10% yield with similar products. However, the current downtrend in the crypto market has heavily impacted LUNA and the Terra ecosystem.

Some users believe the ecosystem as a whole could be in danger as a result of a reduction in Anchor’s reserves which according to some projections could reach $0 in the coming weeks. Without these funds, the protocol would be unable to pay off its users and due to Terra’s mechanism, it could trigger a fresh leg down across its assets.

The pegged in UST has been offered in the past days, as more users seem to believe this theory. Thus, panic spreads amongst sellers looking to mitigate their losses. As of press time, UST has seen an important recovery as it hit a multi-month low of 0.98 versus the U.S. dollar.

UST recovering its pegged on the 4-hour chart. Source: Tradingview
Terra (LUNA) Inventor Addresses Concerns Around Anchor

Do Kwon, co-founder, and CEO of Terraform Labs, the entity behind Terra’s ecosystem, recently addressed the controversy generated around Anchor and UST. In an attempt to counterbalance the FUD, as some LUNA holder has called it, Do Kwon emphasized Anchor’s objectives.

The first, he wrote on a Twitter thread, is to make market yields on stablecoins less volatile, while increasing the capital efficiency of the platform. Anchor’s Yield Reserve is a “centerpiece” to address these issues, but this component of the protocol can operate with a surplus or a deficit. Kwon said:

Recently as leverage started to wind down from crypto markets, deposits have gone up a lot and borrowing down. The yield reserve has been running at a deficit to maintain the deposit yield.

Users seem to believe that the Yield Reserve, Kwon said, should “always operate at a surplus”, and that the YR depletion will “have disastrous consequences”. The co-founder of Terraform Labs said that Anchor’s Yield Reserve was always designed to be used on current market conditions.

On the second widespread concern by users, Kwon said that if the protocol runs out of funds in its Yield Reserve, it will “operate as a regular money market” still offering users around 15% to 16% in incentives. Therefore, he concluded that the protocol, and by extension the ecosystem, “will be fine”.

Related Reading | NEAR Records 70% Rally On Terra Integration, Will It Close The Year In Profit?

In the future, the team at Terraform Labs will make improvements to reduce “LUNA dominance in Anchor collateral under 40%”. In that way, a similar situation could be prevented. In the meantime, Kwon said:

I am resolved to find ways of subsidizing the yield reserve. Anchor is still in the growth phase, and maintaining the most attractive yield in DeFi stable will strengthen that growth & build up moats.

Posted on

NEAR Records 70% Rally On Terra Integration, Will It Close The Year In Profit?

During December, highly scalable blockchain Near and its underlying asset has experienced an important rally. Coming in hot from a monthly low at around $6, the NEAR token currently trades at $15,37, close to its all-time high north of the $16 mark.

NEAR trends to the upside in the 4-hour chart. Source: NEARUSDT Tradingview

In the past 7-days, according to data from Coingecko, NEAR has record a 71.5% rally and an 87.4% increase in the last 30 days. The team behind the protocol has been announcing improvements and partnerships that have contributed with this token’s trend to the upside.

Related Reading | LUNA Hits ATH After Astroport’s Deployment, Why Terra Could Continue Growing In 2022

Terra’s UST stablecoin integration with NEAR and the Aurora ecosystem has been a highly expected event by users. Per an official post, the integration was facilitated by a partnership with NearPad, an Aurora DeFi gateway, and Rose, a liquidity and stableswap borrowing protocol running on the same ecosystem.

The team behind NEAR believes the partners will be able to strengthen the Terra ecosystem and stablecoin UST as they become more adopted on Aurora. In that sense, users will have several new use cases that will be able to leverage including moving assets from Aurora to Terra or any other compatible blockchain.

Users will be incentive to participate and to provide UST liquidity on the aforementioned ecosystems. Aiden Knox, founder of NearPad and Rose claimed the following on this integration:

Partnering with Terra to bring UST to ecosystem to our community will be a big step towards growing the Near and Aurora ecosystem. I’m excited to be working closely with the Terra team to not only bring UST to NearPad and Rose, but also for the deeper integrations and collaborative projects this partnership enables.

NEAR To Support One Of The Fastest Growing Stablecoins

The Near protocol has been working on its interoperable capabilities as the project aims to support a “multi-chain future”. In that way, users will be the most benefits as more use cases, and applications become accessible, and they can reach any asset or projects in different networks. Co-Founder of NEAR Illia Polosukhin said:

NEAR has been built for simplicity, security and scalability. Stablecoins like UST provide a simple interface to store value and interact with apps which need to use a stable unit of account.

Recently, the Terra ecosystem implemented several major upgrades on the mainnet with provides it with interoperability, and a burning mechanism for its underlying asset, LUNA. As NewsBTC reported, this network has taken the crypto industry by storm.

Related Reading | Terra Begins LUNA Burning, Why It Could Target $140

In addition, Do Kwon, one of Terra’s founders, recently celebrated the expansion in UST as the stablecoin reached a $10 billion market cap. Thus, it has become the largest decentralized stablecoin which demonstrates, according to Kwon, that “there is no more doubt in the product market fit”.

Congrats to @terra_money on reaching $10bn outstanding. Amazing achievement, but will seem small compared to what will be accomplished in the coming years.

Long live decentralized stablecoins. Long live @terra_money. https://t.co/3Uz2ZYFAWz

— Peter Johnson (@TheChicagoVC) December 26, 2021

Posted on

LUNA Hits ATH After Astroport’s Deployment, Why Terra Could Continue Growing In 2022

Maybe one of the best-performing assets in 2021, LUNA has been trending against the market for the past 2 weeks. While Bitcoin, Ethereum, and other major cryptocurrencies remained rangebound, the native token for the Terra ecosystem re-entered uncharted territories.

Related Reading | Terra Begins LUNA Burning, Why It Could Target $140

As of press time, LUNA trades at $87 coming in from a monthly low at $38 which represents almost a 40% increase over that period.

LUNA on a rally in the 4-hour chart. Source: LUNAUSDT Tradingview

As reported by NewsBTC, Terra deployed several improvements on its mainnet in the past months. These included Colombus-5, Wormhole v2, and an Inter-Blockchain Communication (IBC) protocol.

The first of these upgrades could be the fuel that has triggered LUNA’s rally as it implemented a burning mechanism into the network. Effectively, this upgrade has turned LUNA into a deflationary asset that will continue to see buying pressure into the future.

Per a report by Delphi Digital, the Terra ecosystem has also benefited from the deployment of Astroport, an Automated Market Maker (AMM). The protocol is yet in an early phase but has already seen over $1 billion in capital inflows.

This capital injection into Terra’s ecosystem coincides with LUNA’s rally which goes to show the importance of adoption for this token’s performance. Delphi Digital said:

LUNA price notched another ATH today before retracing lower. The price increase over the last few days was likely triggered by investors buying spot LUNA to lock up in the Astroport lockdrop, then hedging their position via perpetual futures to remain delta neutral.

Source: Delphi Digital

As the chart also shows, LUNA has the right ingredients to continue its rally: reaching price discovery on negative funding rates for the derivatives sector, which suggests speculators expected more downside in a short time. It remains to be seen if the trend will be able to hold in 2022.

Terra (LUNA) And Its Potential To Take Over 2022

LUNA’s ecosystem has displayed strength in other sectors. The network’s native stablecoin UST has been gaining more adoption and could potentially disrupt this sector of the crypto market.

Delphi Digital records an increase in market capitalization for UST since December 15th. This stablecoin has been in a close fight with DAI, one of Ethereum’s most prominent assets, as seen below. Delphi Digital added:

UST and DAI have been neck-and-neck in terms of market capitalization, with UST briefly overtaking DAI as the 4th largest stablecoin last week. Yesterday, UST overtook DAI more decisively as it had been trading higher for at least the last 24 hours.

Related Reading | LUNA Outperforms Bitcoin’s Rally, Why It’s Ready For Massive Gains

Christmas is still some days away, but December has already proven itself as one of LUNA and Terra’s most important months in 2021. With solid fundamentals, this network seems poised to continue its upwards trend in the near future.

Posted on

LUNA Outperforms Bitcoin’s Rally, Why It’s Ready For Massive Gains

Bulls are in control as Bitcoin and the crypto market break every all-time high, coming into the top 10 is Terra’s native cryptocurrency LUNA with a 12.9% rally in the daily chart. Trading north of $40, at press time, this cryptocurrency has outperformed BTC and major altcoins in lower timeframes.

LUNA on a rally in the daily chart. Source: LUNAUSDT Tradingview

However, LUNA could be just firing up its engines and getting ready for a fresh leg-up in the short term. The Terra ecosystem has been implementing major improvements to its ecosystem in the past months.

Related Reading | Why The Terra Ecosystem Delayed A Major Mainnet Upgrade For Late September

Therefore, LUNA could have multiple bullish reasons to continue to outperform the market. As researcher Ryan Watkins recently indicated, Terra is closed to implementing all 3 massive upgrades on its infrastructure.

The Colombus-5 and Wormhole V2 upgrades have gone live, and the Inter-Blockchain Communication (IBC) protocol upgrade is set to roll out today, October 20th.

As NewsBTC reported in August, Columbus-5 was delayed providing every actor on the Terra ecosystem with more time to prepare for the upgrade. Designed to introduce a deflationary mechanism for LUNA, this upgrade will increase Terra’s interoperable capabilities while creating more demand for its underlying asset.

In the meantime, the Wormhole upgrade will operate as the communication component between Terra, Ethereum, Solana, Binance Smart Chain, and potentially more blockchains in the future.

Related Reading | Why Terra (LUNA) Will Reward Users With New Community Bounty Program

In addition, the upgrade introduced a user interface that will remove friction between the network value transfer capacity. Finally, the IBC protocol will allow Terra to benefit from “permissionless trans of tokens across chains”. The team behind Wormhole celebrated the achievement:

Terra is known for its vibrant ecosystem, #LUNAtic community, and its decentralized stablecoin, $UST. Terra has grown at a dramatic rate in recent months, and we’re excited to unleash Terra innovation on the SOL, ETH, and BSC communities!

LUNA Ready For Take-Off? Bull Market In Its Early Days

Historically, tokens with interoperable capacities have performed well. Binance Smart Chain token BNB, integrated with its own burn mechanism, went from a low below $30 in 2020 to an all-time high above $600 on the back of its CeDeFi utility.

Related Reading | Can LUNA Reach $170? This VC Fund Thinks It Has The Fundamentals

Terra has another secrete weapon in its stablecoin UST. Talking about recent developments, Watkins claimed that the Terra ecosystem has built the potential for a new cross-chain trade boom. In September, the researcher made the following prediction:

With Colombus-5 and Wormhole V2 going live in the coming weeks, UST growth will likely accelerate, setting it up to challenge DAI for the top spot among decentralized stablecoins.

As seen in the chart below, Terra’s native UST has taken the decentralized stablecoin market by storm. Since February 2021, its dominance over this sector has skyrocketed and seems poised to continue the trend with an upgraded ecosystem.

Source: Ryan Watkins, Messari via Twitter

As Watkins pointed out, there are two main trends that will allow UST and Terra to grow: new capital coming into the ecosystem due to the upgrades, UST moving onto new platforms.

In totality these catalysts could all drive a ton of new demand for UST in the coming months, which has already been the fastest growing decentralized stablecoin in 2021. pic.twitter.com/LxcTF6LHKJ

— Ryan Watkins (@RyanWatkins_) September 15, 2021

Posted on

Why The Terra Ecosystem Delayed A Major Mainnet Upgrade For Late September

After a 130% rally over the past month, Terra (LUNA) is one of the best-performing assets in the crypto market. At the time of writing, LUNA trades at $31.95, a little over a year ago it was barely breaking out above $1.

LUNA moving sideways in the 24-hours chart. Source: LUNAUSDT Tradingview

The massive price appreciation is driven by a growth in the LUNA ecosystem and an increase in demand for its stablecoin UST. In order to support this growth, Terraform Labs (TFL) has been planning to introduce an update.

Called Columbus 5, its mainnet deployment has been delayed for 3 weeks, according to an official post. The update will take place at the height of block 4,724,000, on September 30, 03:30 UTC.

The team behind Terra claimed that they want to “implement some extra precautionary measures” to roll out the update. They added:

(…) the Columbus-5 mainnet upgrade is massive. Behind the scenes, numerous moving parts require attentive and thorough examination from multiple perspectives + reviews between TFL, eco partners, the community, and projects dependent on Terra applications.

In addition, they provided 3 main reasons that led them to delay the update. First, the network will have a new version of Mantle, their framework to write indexes or Extract-Transform-Loan (ETL) logic.

This new version of Mantle will be more scalable and will be able to support “significantly” more traffic. It will be introduced with Colombus 5. Terraform Labs claimed:

Mantle plays a critical role in mediating application network traffic on Terra, ensuring the compatibility of the new version between Col-4 and Col-5 is paramount, requiring additional testing to verify the new design changes.

The second reason for the delay is due to Terra’s partners and third-party projects. The team behind the ecosystem wants these projects to have more time and “breathing room” to migrate to Columbus 5.

This includes projects like Mirror, Anchor, TerraSwap, Shuttle. Before the update, the developers behind these applications must be familiar with the updated mainnet.

Terra Will Update To Support Massive Growth

As Terraform Labs said, the LUNA ecosystem’s total value locked (TVL) stands at $7.3 billion with “tens of thousands” of new stakeholders, and builders coming into the platform. Thus, why they have decided to grant their community and developers more time to prepare:

The original timeline produced a hurried window for some projects to properly prep for Col-5. Giving projects more time to acquaint themselves with the Col-5 testing environment and migration plans for major apps ensures a smoother runway for projects launching post-Col-5.

In that sense, the team made a commitment to provide more documentation and educational material for the community to “use the update properly”. In this documentation, they will address some of the community and third-party project’s concerns on Col-5.

The official migration guides for Mirror and Anchor will be released on September 13th, meaning web apps, contracts, and bots will be functional and operational on Bombay for users by this time. TerraSwap has already been migrated.

In the coming weeks, Terraform Labs will give more information on the “sequence of events” leading to the mainnet. Thus, they will make it a priority to “guarantee” a “smooth” Col-5 launch.

14/ With swelling billions of TVL, tens of thousands of new users, and an amazing and devoted community, prudence is the optimal path forward for such a significant launch.

Thanks for your patience and understanding.

More updates to follow soon. Please stay tuned.

— Terra (UST) 🌍 Powered by LUNA 🌕 (@terra_money) September 1, 2021

Posted on

Layer 1 Crypto Token Surge Brings 200% Gains During August

Arcane Research recently published a crypto market update and explored the rise of layer 1 tokens over the past 30 days. The season of “ETH Killers” as the research firm and many others have called them.

Although the second cryptocurrency by market cap was leading the crypto market up until a few weeks ago, its competitors have been gaining traction, smashing all resistance towards new all-time highs.

As seen in the chart below, some layer 1 tokens in the crypto market have experienced massive rallies in August.

Solana (SOL) leads the chart with a 221% rally, followed by Terra (LUNA) with a 217% rally, Fantom (FTM), and Avalanche (AVAX), sit at the last spots of the biggest layer 1 tokens with a 215% and 210% rally, respectively.

Source: Arcane Research

Binance Coin (BNB, 38%), Ethereum (ETH, 28%), and Polygon (MATIC, 22%), also made the cut with important profits in the same period.

Crypto exchange Binance’s token slowed down on its late 2020 rally. Similar to SOL, LUNA, and AVAX, BNB surged on the back of the DeFi boom as users migrated to the Binance Smart Chain ecosystem due to its high fees.

Solana seems to have taken part in its market share. Arcane Research noted the increase in this token’s market from $9.5 billion to $35 billion in one month. SOL climbed its way to the 8th position in the crypto top 10 by market cap.

The report attributes SOL’s appreciation to its high throughput of 50,000 transactions per second with low fees when compared to Ethereum. This has made Solana attractive for developers.

As NewsBTC reported, some experts believe SOL will be one of the best performing crypto assets of 2021. Despite its 221% rally in August, there seems to be room for more appreciation based on the token’s growing fundamentals.

Ethereum, King Of Crypto In The DeFi Sector

The DeFi and the increase in adoption of the non-fungible tokens (NFTs) sector could determine which crypto will dominate the market in the coming months.

In that sense, the total value locked (TVL), a controversial metric due to its “sketchy” accuracy, in Solana recently surpassed the $2 billion mark.

However, Arcane Research claims that no layer 1 network will be able to outperform Ethereum in terms of DeFi market share. Data from DeFi Pulse record a TVL of $89 billion for all DeFi protocols.

The Ethereum network has supremacy in this sector, the most popular dApps are hosted on its ecosystem. Aave, MakerDAO, Curve Finance, Compound, Uniswap, Yearn Finance, SushiSwap.

Source: DeFi Pulse

These protocols have a total value locked (TVL) ranging from $4.2 to $15.86 billion. The smallest DeFi protocol in the Ethereum top 10 by TVL has double that held on Solana, Arcane Research claimed:

ETH has experience growing transaction fees amid the NFT frenzy, possibly attracting more users to other chains. However, in the ecosystem overall, Ethereum remains the clear leader, and it seems unlikely that any other protocol will dethrone Ethereum’s position in the near future.

At the time of writing, ETH trades at $3,398. The second crypto by market cap has a 5.2% profit in the daily chart.

ETH with moderate profits in the daily chart. Source: ETHUSD Tradingview