Terra has turned into a questionable blockchain project following the collapse of their native token LUNA and stablecoin TerraUSD (UST) in May. Nevertheless its recent gains are difficult to disregard for cryptocurrency traders.
LUNA rising in the dead?
After crashing to almost zero in May, LUNA has become buying and selling for approximately $6, an astonishing 17,559,000% cost rally in under four several weeks when measured from the cheapest level.
Meanwhile, LUNA’s performance in September is especially interesting, trained with has rallied by greater than 300% month-to-date following a lengthy duration of sideways consolidation.
Terra ecosystem in September
It is essential to notice that LUNA also trades using the ticker LUNA2 across multiple exchanges.
At length, Terraform Labs, the firm behind the Terra project, divided that old chain into Terra Classic (LUNC) and Terra LUNA 2. (LUNA/LUNA2).
Related: Do Kwon apparently hires lawyers in S. Korea to organize for Terra analysis
Terra Classic may be the original form of the Terra blockchain, while Terra LUNA 2. was produced as part of a regeneration strategy by Terraform Labs founder Do Kwon. By doing this, Kwon and the team periodically airdrop the LUNA2 tokens to users impacted by Terra’s collapse.
LUNA/LUNA2 began pumping on Sep. 9, your day which a lot of things happened within the Terra ecosystem.
First, Terra Classic (LUNC) passed governance proposals to include single.2% tax on its on-chain transactions at the time. In short, the proposals will permanently remove 1.2% from the LUNC supply from each on-chain transaction, as Cointelegraph covered here.
Terra Luna Classic (#LUNC) skyrockets >37,000% since its bottom following the Terra collapse
This uses an offer to apply single.2% token burn tax on all transactions that will $LUNC to become deflationary cryptocurrency.#LUNC ✨ #HaileyLUNC ✨ $LUNC ✨ pic.twitter.com/oIxI7tqVkW
— Hailey LUNC ✳️ (@TheMoonHailey) September 7, 2022
Second, a self-announced Terra whistleblower, FatMan, reported a suspicious transaction worth 435,000 LUNA2 tokens to Binance, alleging the sender is TerraForm Labs.
“Was eating lunch [and] saw LUNA2 pump. Checked the TFL Beginning wallet. Affirmed, after several weeks of farming rewards using the airdrop they’re saying they never received, they sent all 435K available LUNA 2 to Binance just days ago. That’s only one address.”
.@clayop tallied in the figures – TFL sent as many as $3.9 billion USD (in UST) to exchanges including Binance and KuCoin.
Allow the enormity of this figure sink in, and think about the number of people’s savings that’s added up. Crypto’s greatest fraud.
No explanation from @stablekwon https://t.co/qc2kCFPMHW
— FatMan (@FatManTerra) September 9, 2022
However, Do Kwon ignored the allegations.
The Sep. 9 pump also happened per week after Terra passed the proposal to conduct its second airdrop well over 19 million LUNA tokens until March. 4.
LUNA cost technicals lean bearish
Theoretically speaking, LUNA’s cost risks having a massive correction within the future.
First of all, around the four-hour chart, the token’s relative strength index (RSI) has leaped above 70, that is considered overbought territory in which a correction gets to be more likely. Next, the cost continues to be developing an increasing wedge, a bearish reversal pattern, since Sep. 9.
Particularly, an increasing wedge forms once the cost trends greater in a climbing range whose lower and upper trendlines converge toward each other. It resolves following the cost breaks underneath the lower trendline plus a increase in buying and selling volume.
By Sep. 11, LUNA was testing its wedge’s lower trendline for any potential breakdown move. Within this situation, the cost will risk falling up to the wedge’s maximum height.
Quite simply, LUNA could drop to $4.5, lower 30% from today’s cost.
The views and opinions expressed listed here are exclusively individuals from the author and don’t always reflect the views of Cointelegraph.com. Every investment and buying and selling move involves risk, you need to conduct your personal research when making the decision.
