token crypto LUNA land lately it’s trending and a lot of people talk about, especially crypto investors. How come? The price of Terra LUNA has fallen by more than 90% in the last 24 hours of trading and has been going on for the past few days.
The price of this crypto asset, which was once the prima donna of investors, fell by 96.39% in the last 24 hours of trading on Thursday (12/5/202) yesterday. Quoted from CoinmarketCap, Thursday (12/5), at 13.00 WIB Terra LUNA was traded at US$ 0.32 or the equivalent of Rp 4,659 per coin.
Meanwhile, quoted from Coinbase, Friday (13/5) this morning, the price of Terra LUNA fell by 99.36% to IDR 106 per coin. Whereas in April 2022, the price touched the highest level of IDR 1.7 million per coin.
Terra LUNA’s initial coin offering (ICO) was held in 2019. Terra LUNA was also the sixth-largest cryptocurrency asset by market capitalization, with a value of US$ 40 billion. Unfortunately, now the price has dropped drastically!
Before discussing why the price of Terra LUNA has dropped so much now, let’s see what it actually is LUNA land that?
What is Terra LUNA?
Terra LUNA is a crypto token that is traded using a blockchain system. Blockchain itself is a technology used as a digital storage system (data bank) connected to cryptography.
What about the crypto token itself? Launch page Business Insidercrypto tokens are digital assets that can be stored for value, traded and ‘stamped’ for profit.
Terra LUNA is a form of crypto asset named “Terra” with the trading code “LUNA”, developed by Terra Labs in South Korea.
Terra LUNA also has ambitions to become a platform by creating stablecoins, which are linked to official money issued by the central bank at a price of US$ 0.8 per coin.
Now crypto tokens are also becoming a trend, because many people are trying to invest in crypto. So, basically the Terra Luna crypto token is the same as Bitcoin, dogecoin, binance, and their friends.
However, the difference is that Terra does not have cash and other assets, which are kept in reserve to back up its tokens. So, instead, Terra uses a complex mix of code and LUNA tokens to stabilize its price. It’s a bit tricky.
The Cause of the Fall in Terra LUNA Prices
Quoting CoinDesk, the cause of the decline in the price of Terra LUNA occurred because the price of the stablecoin Terra USD (UST) was shrinking. How come? Because actually Terra LUNA and UST are interrelated.
Quoting from the page Business Today, UST is an algorithmic stablecoin, as it uses a complex token minting and burning system to match supply and stabilize prices. So, Terra’s success is based on the adoption of UST as a stablecoin.
Simply put, this Terra LUNA invested in UST and is currently losing money because the demand for UST is increasing.
In simple terms, the Terra protocol greatly influences the prices of Terra USD and Luna. When the price of Terra USD drops below the dollar, it can only be exchanged for Luna. That’s why Terra USD is becoming scarce and the price can go up.
Terra USD is a stablecoin project linked to the US dollar exchange rate. This token offers a better store of value, to avoid cryptocurrency volatility.
The next panic was that the Luna Foundation Guard had announced that it would lend Bitcoin worth US$ 750 million to trading companies. This was done to help protect the price of Terra USD.
Who is the Owner of the Terra LUNA Crypto Coin?
Do Kwon is the founder or creator of the Terra LUNA crypto asset. Reporting from Forbes, Kwon founded Terra using blockchain technology, to develop a more efficient payment system.
Terra has raised $32 million from crypto giants such as Binance, Arrington XRP and Polychain Capital, as well as formed an alliance of trading partners including Ticketmonster and travel service Yanolja.
Currently, Do Kwon admits that he is preparing steps to save Terra. He said that he would soon announce the plan. He reminded supporters to be patient.
Kwon seeks to return TerraUSD to its $1 target price by increasing the new Terra LUNA printing rate per day.
“I understand that the last 72 hours have been extremely difficult for all of you – know that I am determined to work with all of you to resolve this crisis, and we will build a way out of this,” he said. .
So you understand why? LUNA land the price dropped?
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(fdl / fdl)