Phoenix rose from his ashes. As a Phoenix, you need to come back stronger, smarter and more energetic. Terra Luna 2.0 has definitely risen from its ashes too. However, is it really stronger, smarter and more energetic? In addition to that, does Do Kwon know something we don’t? It’s definitely been a pretty tough road, and we’re about to try to make sense of it. Crypto analysts are discussing Terra LUNA 2.0.
What is Terra LUNA 2.0?
This project, Terra LUNA 2.0, is the result of the 1623 proposal put forward by Do Kwon. The lunatics could have upvoted several proposals, but this one was by far the most popular. 305.98 million people voted, which means 89.95% of voting rights. 65.5% voted in favour, which corresponds to 200 million votes. 21% abstained and 13% voted against the proposal. The proposal received half a million views and 5,300 responses. That means a lot of attention and interaction. What was the offer for
1623? He was proposing that there would be a new Luna Layer-1 Blockchain. A fork from the legacy Blockchain. And here it gets a little confusing. Let’s make it clear for you:
- The legacy Blockchain is in progress and is now known as Terra Classic.
- As a result, they renamed the original Luna token Luna Classic (LUNC).
- New Blockchain has a new cryptocurrency that will continue under the name LUNA (LUNA).
- UST will continue to live on Terra Classic under the new name USTC.
- The new fork does not have any UST counterparts.
Additionally, the original LUNA’s dev team will migrate to the new Blockchain. Many projects in Terra Classic will also be migrated.
Moreover, they will find new living spaces in the new chain. For example, Astroport, Prism, RandomEarth are among them. In addition, the release date was set for May 28. This went hand in hand with a massive airdrop of the new LUNA token. Probably one of the main reasons why this proposal does this. People want to try to save as much as they can. An airdrop would probably help them with that.
How do we feel about Terra LUNA 2.0?
5 days have passed since the fork, but so many questions remained unanswered. Let’s try to solve these questions. Terra Luna’s downfall became a hot and emotional topic, and many people were burned. Some even lost all their savings. No matter how you look at this, this is not acceptable.
Now, let’s take a look at some of the questions that are on everyone’s minds about Terra LUNA 2.0
Can Terra 2.0 re-establish trust?
That’s what we’re dealing with. As you can follow from Kriptokoin.com news, Binance listed Terra Luna on June 1st. The exchange still carries a warning that Terra Luna is subject to ‘high volatility’, but that hasn’t stopped thousands of new investors from buying Terra Luna. According to Airdrop, there is currently a supply of 210 million LUNA in circulation. This gives Terra Luna a market capitalization of approximately $1 billion. However, it is well below the $70 billion he had before the crypto crash.
Some compare the collapse to the $60 billion investor loss in 2009, when the notorious Bernie Madoff was sentenced to 150 years in prison. Is Kwon’s Terra Luna doing the same to its investors? Can Do Kwon face something this harsh?
These questions keep bothering us. That’s why analysts recommend staying away from investing in Luna for now.
What will happen to Terra Luna Classic (LUNC) and its holders?
All original LUNA holders pulled the short straw. The original LUNA token lost 99% of its value. Currently, it is suggested that the original Blockchain will continue to exist. So they will be in the universe with the new Blockchain.
We checked out Terra Classic explorer and saw some activity there. All existing Terra Classic holders will receive a share of this airdrop. Terra took two screenshots. The original LUNA’s (now LUNA Classic) holders were part of the first screenshot. These are the pre-collapse holders.
If you purchased LUNA tokens after the crash, Terra took a screenshot a few days later. Then you will also receive a smaller airdrop. With a supply of 1 billion LUNA, the airdrop allocations will be as follows:
- Luna owners before the crash: 35%
- Luna owners after the attack: 10% (980710)
- AUST owners before the attack : 10%
- Post-Attack IHR holders: 15% (980710)
- Community Pool: 30%. This includes 10% for developers. Luna stakers will check this.
If you have 10K LUNA, you get 30% in formation. The remaining 70% has a gap of 6 months and a qualifying period of 2 years. This is good news for small investors and individuals.
Most exchanges support the new Terra LUNA 2.0. This means that most people will receive their airdrops. However, this is a complex affair as Terra only has a small crew. Experts remind that not everyone will receive airdrops at the same time. Some investors are already complaining.
How will Luna 2.0 perform?
That’s the million dollar question. How will Terra LUNA 2.0 perform? It all started very hopeful at $18.87 per token on May 28. But what do you think most people in the first wave of airdrops are doing? That’s right, they were selling their brand new LUNA tokens faster than they could drop them into their wallets. Conclusion? A 75% reduction in the initial price. It dropped to $4.39 within 5 hours of its release.
It also hit $11.33 again on May 31. That didn’t last long though, and it is currently trading at $4.85. Terra LUNA has a market cap of approximately $1 billion. They also claim that the current circulating supply is 210 million LUNA tokens. Meanwhile, the price of the LUNA Classic (LUNC) token continues to drop, starting with a price of 4 zeros.
So, it’s early days yet. There are some issues with airdrops, but Terra says she’s trying to fix them as soon as possible. Will this have an impact on the current price of around $5? It’s hard to say. Just like Binance, analysts can only warn to be careful when investing in the LUNC or LUNA token. Volatility is high in both tokens.
Also, the new Terra LUNA 2.0 token has a lot to prove. Experts think it might be best to sit in the waiting room and see how this unfolds. Maybe they think that one kiss by Terra will be enough.
What shortcomings of Terra Classic are being fixed in LUNA 2.0?
There were several shortcomings that led to the LUNA crash. In the fresh install, Do Kwon tries to avoid these errors. Earlier, it was mentioned that maybe it is “same but different”. So, let’s take a look at what’s different. Here are the two biggest changes.
The most important and #1 change is the absence of a new UST or similar token. No more algorithmic stablecoins. Anchor Protocol was at the root of the entire Terra Luna collapse with its 20% payoff, and they had no way of maintaining that yield. This costs Anchor $3.4 billion a year. There were far more lenders than borrowers. Therefore, after the crash, we see first-time borrowers and lenders moving closer together.
Still like mustard after dinner. It doesn’t matter anymore. Whatever it’s worth, the APY is at 16%. However, since UST’s de-peg, it doesn’t matter much. The current price of USTC is $0.01577. That’s a league away from $1.
Also, Anchor has been pretty quiet on Twitter lately. There isn’t much to talk about anymore. One of their recent tweets is how they will connect BETH to Ethereum and get just under 4% APR. As Bob Dylan already knows in 6 t-shirts, times are changing.
On the other hand, there is no reserve wallet anymore. Therefore, this became outdated when there was no stablecoin to back up. This also makes Terra a fully community owned Blockchain.
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