Best Stablecoin Ecosystem, LUNA Highly Undervalued But Expected Top Three Coins in 2023

6 min read

Luna classic (LUNC) is the native token of the original Terra blockchain, launched in 2018. At that time, the token’s name was LUNA. In the wake of the collapse of the blockchain’s algorithmic stablecoin, TerraUSD (UST), in May 2022, the community voted to create a new blockchain.

After the launch of “Terra 2,” the native token of the new network inherited the LUNA name, while the old blockchain’s token was rebranded to luna classic (LUNC).

The goal of Terra Labs, the firm that developed the coins, is that the protocols and applications of the former network will migrate to the new blockchain (Terra 2). But as of June 2022, the future utility of the original Terra blockchain is still being determined.

What is good about LUNA?

LUNA has one of the best stablecoin ecosystems available currently. The system works because anyone can deposit their stablecoins into LUNA and earn a massive 20% APY, which trumps what you get from anywhere else. More importantly, these interest payouts are sustainable and funded by actual revenue (unlike other stablecoin deposit platforms supported by private VCs). 

LUNA pays these interests through fees obtained from the decentralized apps in their ecosystem – such as “Chai,” a payments platform that 2.2M users in South Korea currently use to transact the KRT with thousands of merchants and generating large amounts of fees; MIR, a platform that allows users to trade synthetics such as stocks and precious metals; ANCHOR, an accessible savings and loan platform; Orion Money, a cross-chain savings application that allows one to quickly deposit the common stablecoins such as USDT, USDC, DAI and earn up to 20% APY.

The Terra LUNA ecosystem has only a market cap of $17B and is highly undervalued. But we can expect more and more institutions and corporations to adopt it soon. When the current bull run ends, we can expect many people to convert their profits to stablecoins and deposit them to earn the best APY through the crypto winter. These together will bring in lots of money and help LUNA’s value rocket upwards.

So, how high can LUNA go?

The price of LUNA is $44, with a market cap of around $17B. A price of $2000 would mean a 45.4x increase in market cap to $770B. Note that this is simplified and assumes the coins in circulation remain constant over time, but it is reasonable given that we are already in the final phase of the current bull run.

This number is right between ETH’s current market cap of $530B and BTC’s current market cap of $1.1T. Hence, it is doable. LUNA has the best stablecoin ecosystem and is undervalued – how can it be below DOGE and SHIB?

LUNA should be one of the top three coins, along with ETH and BTC. A $2000 only places it right where it deserves to be.

Luna Classic (LUNC), the cryptocurrency behind the now-defunct original Terra blockchain destroyed in May 2021, was last trading near $0.0001221, only slightly higher than the $0.000117 lows it hit earlier this month. LUNC has performed poorly, despite other significant cryptocurrencies rallying in March. Since the beginning of March, the cryptocurrency has lost approximately 26% of its value.

Following the disasters in 2022, most of Terra’s blockchain development community left, and most analysts see a bleak future for the blockchain ecosystem.

The news of Terra co-founder Do Kwon’s arrest only last week reached the crypto community; its price soon fell steeply to $0.0001221. Terra co-founder Do Kwon, who was on the run since the Terra-Luna crisis, was finally arrested in Montenegro on 23 March.

LUNC was at the center of the collapse of the Terra ecosystem in May 2022. The coin has also been severely affected by the collapse of the crypto exchange FTX in November last year. Its market capitalization has dropped from $1.5 billion to $1.0.4 billion since then.

Transactions on the Terra 2.0 blockchain are validated through the proof-of-stake (PoS) consensus mechanism. The leading cryptocurrency, Ethereum (ETH), has also transitioned from a proof-of-work to a proof-of-stake mechanism. It has only made the competition among PoS blockchains more challenging.

The network has 130 validators working at a given point of time. As a PoS platform, it is considered a very eco-friendly token.

Why do these projections matter?

A stablecoin is intended to safeguard coin holders against the volatility of other cryptocurrencies. It is pegged to a fiat currency such as USD or a supporting cryptocurrency. Terra USD (UST) was pegged to Luna Classic (LUNC- then, only LUNA).

This is where the problem began. A cryptocurrency is in no way equivalent to gold reserves. As LUNA prices became destabilized, they affected UST prices too, and the entire stablecoin system collapsed in May 2022.

For the initial few years, LUNC kept performing well. And it was even among the top 10 cryptocurrencies by market value by the end of 2021.

But the Terra system collapsed in May 2022, leading to a fork. It launched a new version of Luna, and the Terra Ecosystem Revival Plan 2 was implemented, according to which both versions of the Luna token can exist.

Undoubtedly, the future of this cryptocurrency is crucial in determining if a failed crypto can make a comeback and grow.

Well, its performance after the May 2022 debacle has been, so far, less than celebratory.

But if LUNC trades well in the future, it will be a cause of celebration not only for this particular cryptocurrency and many other cryptos.

LUNC’s price, volume, and everything in between

Since its launch in 2019, LUNC’s price kept floating around $0.2 and $1.3 until April 2021. When the crypto market boomed in mid-2021, its price increased and touched $100 by the end of the year.

Starting from 2022, it kept oscillating between $50 and $100 and reached an all-time high (ATH) of $119.18 on 5 April 2022. The following month, its price fell, and the Terra system collapsed in mid-May.

At press time, the coin was trading at $0.000126, with a market cap of $740,110,030.

Bloomberg reported in May 2022 that the market lost approximately $45 billion within a week following the Terra collapse. Terraform Labs and its co-founder Do Kwon were fined $78.4 million in corporate and income tax by the Korean National Tax Service.

On 25 May 2022, Bloomberg reported that the network launched a new cryptocurrency version, LUNA. The older crypto is now Luna Classic (LUNC), and the newer one is Luna 2.0 (LUNA).

Though LUNC, the older cryptocurrency, has yet to be entirely replaced, many users are moving to LUNA. LUNC needs to perform better.

Market Capitalization of LUNC 

The market capitalization of LUNC similarly reflects the market sentiment regarding crypto. Throughout 2019-20, it didn’t even reach up to $500 million but began increasing in 2021.

Now, towards the beginning of February, it crossed the $1 billion mark. And by the end of 2022, it was above $36 billion.

LUNC’s journey kept moving upward the following year, too, and in April 2022, it crossed $41 billion. But post the crash of May 2022, it oscillated between $300 million and $1.5 billion.

South Korea is now seeking to revoke Kwon’s passport, following which he might be forced to return to South Korea. A request has been passed to the nation’s Foreign Ministry to scrap the travel document, reported Bloomberg. An arrest warrant has already been issued against him and other members.

Financial Times recently reported that South Korean prosecutors have asked Interpol to issue a Red Notice against Kwon. However, Kwon tweeted that he is not on the run from any interested government agency and added that the company is in full cooperation and has nothing to hide.

The crypto crisis that followed the collapse of the twin coins, Terra USD and Luna Classic, has adversely affected the entire crypto market. LUNC, in such circumstances, remains particularly vulnerable.

So far, we have provided a succinct summary of LUNA Classic (LUNC). For those contemplating investing in cryptocurrency, we want to reiterate that cryptocurrency predictions can only be relied upon partially. And you should conduct your research before investing in LUNC.

The only thing that can save the coin is token burning, which will raise prices by reducing market oversupply. It was already put to the test in September when Binance and other significant CEXs started burning LUNC tokens, sending the price of LUNC soaring by 60% in just a few hours.

Cryptocurrency Market

The cryptocurrency market remains bearish and will likely remain volatile for the next few months.

A recent Bloomberg report says that upcoming legislation would ban algorithmic stablecoins such as TerraUSD, the collapse of which led to a global crypto crash. The bill is currently being drafted in the U.S. House, which would make it illegal to develop or issue new “endogenously collateralized stablecoins.”

The New York Times interviewed Ethereum co-founder Vitalik Buterin last month, who claimed that the Terra Luna team attempted market manipulation to boost the value of the native cryptocurrency. He also recalled that many “smart people” had stated that Terra was “fundamentally bad.”

In an interview with Laura Shin on the “Unchained” podcast on 28 October, Kwon claimed that he migrated from South Korea to Singapore before the demise of the Terra environment. He also refuted reports that he is eluding law authorities.

Kwon said, “Whatever issues existed in Terra’s design, its weakness [in responding] to the cruelty of the markets, it’s my responsibility and my responsibility alone.”

Terra Rebels

On 5 November, Terra Rebels tweeted that the first round of its lottery game had finally ended, with the winner going away with over 24 million Terra Luna Classic (LUNC). More than 10.5 million LUNC were sent to the burn wallet. As we can see, such efforts are underway in one way or another.

According to a recent third-party audit by J.S. Held, a New York-based consultancy firm, Luna Foundation Guard (LFG), the entity behind the defunct Terra ecosystem, spent $2.8 billion in crypto to defend the peg of algorithmic stablecoin TerraUSD (UST) in May. The audit also claims that Terraform Labs (TFL), the Terra blockchain developer, spent $613 million defending the peg.

Luna Classic

Luna Classic has announced that it will re-enable Inter Blockchain Communication (IBC), a protocol to allow sharing of messages and trading assets with other blockchains. A member of the Terra Classic development team confirmed this on Twitter.

In terms of fundamentals, what may help such a break occur is progress on implementing a proposal recently passed by Terra Luna Classic validators. In particular, the community has adopted a plan to re-peg LUNC’s sister stablecoin, USTC.

As the broader cryptocurrency market stabilizes ahead of a busy week of macro events, including a barrage of key U.S. jobs data and Fed Chair Jerome Powell’s testimony before the U.S. Congress, LUNC bulls hope the cryptocurrency can continue to find support above this level.

Industry experts are apprehensive that LUNC’s price will reach $1 in a few years. As the latest news of Kwon’s arrests appears, the market fears that more details about the program may further decrease its performance.   


Terra LUNA Classic [LUNC] Price Prediction 2025-2030: LUNC loses 26% of its value


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