Reviving Terra Luna Classic: Insights into the LUNCcommunity's Resilience

Bombolo | News and Media

In the fast-paced world of cryptocurrency, where fortunes can be made and lost in the blink of an eye, Terra Luna Classic (LUNC) experienced a tumultuous journey. Despite facing challenges that could have spelled its demise, the LUNC community exhibited remarkable resilience, and the hashtag #LUNCcommunity began trending on Twitter.

Also Read: Should You Invest in LUNC? A Comprehensive Analysis

The Community's Role in Recovery

The turning point for LUNC came when the community rallied to pass critical proposals aimed at addressing the damage caused by over-minting. This crucial step was taken in hopes of recouping the losses incurred during the previous market meltdown.

While Kwon and his team were focused on the developmental aspects of Terra 2.0, Luna Classic was entrusted to the community, signifying a significant shift in its governance.

The Impact of LUNC's Burn Tax

To rectify the damages from over-minting, the community initiated a token burn mechanism. This mechanism began with a burn rate of 1.2% for every LUNC transaction, with the aim of reducing the coin's supply from a staggering 6.8 trillion to a more manageable 10 billion. The goal was not only to limit the supply but also to enhance its demand and value, particularly in the aftermath of a substantial market crash.

Validators played a crucial role in orchestrating this reduction, and their efforts did not go unnoticed. The increased social mentions and engagement, especially on platforms like LunarCrush, indicated a positive response from the community.

Notably, major exchanges, including Binance and KuCoin, threw their support behind the burn mechanism. This support sent encouraging signals to other platforms, further setting the stage for the potential growth of LUNC.

Since May 2022, approximately 74.91 billion LUNC have been burned. While the initial burn rate was 1.2% per transaction, an adjustment saw it drop to 0.2%, with the aim of boosting blockchain activity. However, this rate did not have a significant impact on the circulating supply. Recognizing this, a proposal was made in March 2023, and by May of the same year, the burn rate was raised to 0.5%. As of September 2023, there are 5.82 trillion LUNC in circulation.

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The USTC Suspension

The Terra LUNA Classic community recently voted to suspend the minting of USTC. The primary concern was the USTC-LUNA swap mechanism, which allowed users to easily exchange UST and LUNA. However, this method proved to be problematic during financial crises.

To safeguard the interests of investors, a proposal was made to discontinue this swapping mechanism. This proposal aimed to restore the coin's peg to the U.S. dollar.

A Brief Look at Terra Luna's Origins

The Terra blockchain was developed by Terraform Labs, a company founded by Daniel Shin and Kwon. It made its debut in January 2018, conducting an Initial Coin Offering (ICO) for its native token, LUNA, in early 2019. Terra's exceptional performance propelled it into the top 10 largest cryptocurrencies globally based on market capitalization.

Terra's founders aspired to realize Bitcoin's initial ambition as a decentralized peer-to-peer electronic cash system. They took a unique approach by using stablecoins.

Before co-founding Terra, Daniel Shin launched Ticket Monster (TMON), a prominent e-commerce entity in South Korea. He later co-initiated Fast Track Asia, an incubator supporting entrepreneurs.

On the other hand, Kwon's resume includes founding Anyfi, a startup dedicated to decentralized wireless mesh networking solutions. He honed his skills with industry giants like Microsoft and Apple.

Also Read: Terra Luna Classic's Roadmap: L1TF's Next Chapter in LUNC Revival

Terra Luna Classic (LUNC) Price Analysis

The daily chart for LUNC showed a bearish trend, with the trading price standing at $0.00006296 at the end of the period. The price had spiraled downward, turning previously friendly support levels into formidable barriers.

At the start of the analyzed period, LUNC remained stable, consolidating within the range of $0.000082 to $0.000077. For a while, the lower boundary of this range, $0.000077, acted as a firm support level.

However, a turning point came in mid-August when this support level was breached, transforming it into a newfound resistance. This marked the dominance of a pronounced bearish phase for LUNC.

During this decline, LUNC's price encountered and tested various support levels before finding stability at $0.000057. Towards the end of the analysis period, a slight bullish rally provided a glimmer of hope, though its continuation remained uncertain.

The trading volume during most of this period remained moderate, with a noteworthy surge towards the conclusion of September.

The Bollinger Bands revealed distinct patterns. With LUNC's price breaking from its earlier consolidation, the bands expanded, signaling increased volatility. However, as September neared its close, the bands began to contract, indicating subsiding price volatility.

Throughout most of this period, LUNC's price consistently traded below the 20-week moving average (MA), indicating a dominant bearish trend. It only marginally rose above this moving average at the end of the analysis.

The Relative Strength Index (RSI) emphasized the bearish sentiment, staying below the neutral mark of 50. A low point of 19.30 in mid-August correlated with the initial sharp price decline, indicating extremely oversold conditions. The RSI approached the oversold region twice more before finally ascending above the 50 line, concluding at 52.76.

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Should You Consider Buying LUNC?

Taking into account the indicators reviewed, while the dominant trend has been bearish, recent signs from the Bollinger Bands contraction, the RSI surpassing the 50 mark, and a surge in volume might hint at a possible change in trend or a pullback. Moreover, the community's decision to suspend USDC's minting has garnered significant media and investor attention.

Traders considering a "buy" might aim for a range closer to the aforementioned recent support level at $0.000057 to minimize risk. However, due to the prevailing bearish sentiment and the uncertainties surrounding the sustainability of the recent bullish rally, it's crucial to exercise caution and implement stringent risk management strategies.

Terra Luna Classic Price Prediction

Terra Luna Classic had an eventful 2021. To simplify the latest LUNC price prediction, we can divide it into short-term and long-term forecasts. As of writing this article, LUNC had a trading volume of 10,339,553 and had decreased by -4.31% in the past 30 days.

In the short term, the Terra Luna Classic price prediction for December 2023 suggests an average price of LUNC at $0.3, with the highest possible price for December 2023 estimated at $0.32.

For the long term, the Terra Luna Classic price prediction for April 2024 anticipates an average price of LUNC at $0.00027, with the highest possible price for April 2024 projected to be $0.00029.

As the cryptocurrency market continues to evolve, these predictions offer insights into the potential future of Terra Luna Classic.