Because the cryptocurrency lunc (formerly the moon) is making an unlikely comeback

By mid-May, the lunar cryptocurrency on the Terra Luna blockchain had completely collapsed. Renamed lunc some time later, the latter is experiencing a revival of interest …

The cryptocurrency ecosystem sometimes seems irrational. The price of the lunc (ex luna) cryptocurrency is soaring after experiencing a descent into the underworld.

Recall that in mid-May the price of the cryptocurrency Luna fell by 99.97%, falling to less than $ 0.00005, in the face of the destabilization of the stablecoin terra usd (ust) of the blockchain Terra. Within days, this cryptocurrency which was among the top 20 cryptocurrencies in terms of capitalization, with the equivalent of $ 40 billion in circulation, fell below $ 355 million in capitalization.

Following the collapse of this cryptocurrency (which resulted in considerable losses for many holders of this cryptocurrency), an ecosystem restoration plan proposed by the founder of the Terra Do Know blockchain was accepted by the community. This plan created two separate blockchains: the new Terra blockchain and its luna (luna 2.0) token and the old Terra blockchain, nicknamed Terra Classic and its lunc (formerly luna) token.

A jump of 330%

Four months after the collapse of the moon, its price is starting to rise again. In fact, according to data from Coinmarketcap, its price has been rising since the end of August. For example, the cryptocurrency traded on August 24 at $ 0.000102 and today is trading at $ 0.0004388, thus jumping 330% in just a few weeks. Likewise, its capitalization level was multiplied by 9 between May and September, rising from 355 million to over 2.7 billion on Tuesday.

Among the traces that would explain this rise, we can mention the return of “staking” on the Terra Classic blockchain from August 26 due to the transition to a new version of the blockchain, as announced by the Lunc DAO organization that belongs to the Terra Classic Blockchain.

Recall that staking is an operation that consists, for a cryptocurrency holder, in immobilizing part of what he owns in this cryptocurrency in a specific place (on a trading platform or blockchain), in principle to protect exchanges by helping those who validate transactions. By immobilizing their cryptocurrencies, a user is rewarded in cryptocurrencies at often attractive rates.

According to the specialized Cryptoast media, on the day of the introduction of staking 182 billion luncs had been deposited on the blockchain, equal to 2.6% of the supply of tokens in circulation (over 6.900 billion lunc). This Tuesday, according to the data collected by the Twitter account “Episode of lunch“, 529 billion tokens are staked on the blockchain, or just over 8% of the token supply.

“In my opinion, many users do not necessarily understand all the subtleties and what causes the interest rate to rise at these levels. Furthermore, it is this kind of unsustainable return that has been fatal for the” Earth ecosystem “, explains Sébastien to BFM Crypto. Leguell, founder of the specialized media Au Coin du Bloc.

Furthermore, another event in the line of sight could be at the origin of such a rise: that of a “burn” of this token (ie the destruction of part of the tokens in circulation) expected around 12 September.

To date, in fact, there are more than 6.9 trillion tokens in circulation and “the announced goal would be to lower this total to less than 100 billion tokens initially”, specifies the specialized media Be (in) crypt.

“This is mostly an increase based on speculation thanks to the effect of the figures that promise considerable interest to users. The effect of the burn announcement further reinforces this speculation in the eyes of users. I think there is a lot marketing around this, knowing that most of the protocols used in the past have left the ecosystem “, believes Sébastien Leguell.

Despite the rebound of this cryptocurrency, we take a step back. Today, MON ranks 205 in Coinmarketcap’s ranking in terms of capitalization.

Recall that the cryptocurrency Luna collapsed amidst the turmoil in the cryptocurrency market last May. Its all-time high dates back to April 5, 2022, when the cryptocurrency traded at $ 119, while its all-time low dates back to May 13 when it dropped to $ 0.00001675.

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