Terra (LUNA2) reversed part of the losses this June 9 since it’s cost per token rose up to 67.5% at the time, catching many traders off-guard using their perpetual swap positions.
LUNA2 traders are shorting it
At length, LUNA2’s cost soared from $2 up to $3.58. The volatile intraday move coincided using the liquidation of nearly $4 million price of LUNA2 trades on Binance and Bybit, including $2.46 million price of short positions, data from Coinglass shows.
Interestingly, LUNA2’s funding rates across Binance and Bybit continued to be negative, suggesting that traders continue to be short regardless of the cost bounce.
Shadow wallets FUD
The down-side sentiment within the LUNA2 market has strengthened mainly due to its underperformance in recent days, brought by its connection to Terra, an algorithmic stablecoin project whose native tokens LUNA Classic (LUNAC formerly referred to as LUNA) and TerraUSD (UST) collapsed in May.
Terraform Labs (TFL), the firm behind the Terra blockchain, created LUNA2 in the ashes from the $40 billion project. It distributed the revamped token among investors who’d endured losses using their LUNC and UST investments with an airdrop.
Because it seems, individuals LUNA2 recipients made the decision to dump the token to recuperate a few of their losses, thus pushing its cost lower by 85% under two days after it peaked at $12.24.
Investors will also be likely keeping their distance from LUNA2 among allegations which do Kwon, the founder/Chief executive officer of TFL, has lied about getting zero LUNAC tokens. Particularly, a self-announced Terra insider, known through the pseudonym “FatMan,” claims that TFL and Kwon own 42 million LUNA worth over $200 million.
Do Kwon has mentioned numerous occasions that TFL has zero new LUNA tokens, making Terra 2 ‘community owned’. It is really an outright lie that no-one appears to become speaking about. Actually, TFL owns 42M LUNA, worth over $200m, and they are laying through their teeth. (1/6) pic.twitter.com/D1HIWpAWHG
— FatMan (@FatManTerra) June 6, 2022
The consumer also revealed five “shadow wallets” that hold 42.81 million LUNA2 (worth over $110 million at June 9’s cost), noting they all fit in with Kwon.
“[Do Kwon] used his shadow wallet to approve *their own proposal* through governance manipulation (TFL isn’t designed to election), told everybody it might be a residential area-owned chain, after which gave themself a nine-figure score,” Fatman alleged, adding:
“These are merely the verified wallets — there are lots of others.”
TFL, Kwon under analysis
LUNA2 struggles due to the growing scrutiny around TFL, particularly after it had been alfined $78 million by South Korea’s tax regulator in May.
Furthermore, the U.S. Registration (SEC) can also be investigating whether TFL’s crypto tokens are illegal unregistered securities.
hands lower the greatest fuck up of the season award would go to @stablekwon.
— NFTeddy (@TeddyCleps) June 9, 2022
Consequently, LUNA2’s cost includes a high possibility of heading reduced June using the ongoing trouble for TFL, legal pressures and overall bearish sentiment.
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