Insiders say LUNA Classic has no future but remain optimistic on Terra’s LUNA 2.0 price
- Analysts believe LUNA Classic could continue its downtrend while Terra’s LUNA 2.0 could witness a rally.
- Verified LUNA Classic validator, PFC, offered insights on the war room conversations before the Terra chain was restarted.
- Do Kwon and Terraform Labs were ‘hands off’ in their approach to the colossal UST de-peg and Terra token’s crash.
Do Kwon, CEO of Terraform Labs was least involved in the war room instituted before the launch of the new Terra chain, according to insiders who also revealed they are hopeful for LUNA 2.0 price, but have a negative outlook for LUNA Classic.
Also read: Several investors remain bullish on Terra’s LUNA 2.0 price despite struggles to recovery
Do Kwon and Terraform Labs launched Terra’s LUNA 2.0 hands off
These insiders – verified LUNA validators involved in the launch of Terra’s new chain – revealed how Do Kwon and Terraform Labs were hands off in the “war room” instated before the new blockchain was released. Said validators ThorchainMaximalist and PFC, told CryptoSlate there were significant issues in the handling of the Terra LUNA crisis during which they lost a vast majority of their net worth.
Based on chat logs from the “War room,” the group of validators and Do Kwon intended to restart the Terra chain for only one month. Whether this is still the goal remains unknown. Eventually, the group decided to restart the Terra chain, without taking the issue to community governance, with a green light from Do Kwon.
The group had given up on on-chain governance for the reason that in the last hours of the colossal crash, people scooped up billions of LUNA Classic (formerly Terra tokens) from scratch. This would have left on-chain governance in the hands of the participant who accumulated most LUNA Classic tokens.
Since the launch of the new chain, there have been numerous issues on Terra’s LUNA Classic and validators argue LUNC has no future.
On-chain data revealed that LUNC is suffering a decline in social dominance since the launch of the new LUNA 2.0 token. LUNC’s dominance plummeted 84% within a week. Social dominance identifies whether the token is being discussed by market participants, or not. LUNA Classic therefore has lost its popularity in the community.
Binance lost $1.6 billion of its investment in LUNA
Changpeng Zhao (CZ), the CEO of Binance revealed in a recent interview that Binance Labs made an investment of $3 million in Terra in 2018. Binance received 50 million LUNA tokens in exchange for their investment.
Theoretically, Binance lost $1.6 billion of the investment they made at the top. CZ argued that Binance lost 53.3% of the invested capital and didn’t make any profit from the position.
Unlike other large entities, Binance did not dump their LUNA token holdings on retail users during the crash, nor did the exchange purchase the algorithmic stablecoin UST. There have been allegations of Binance’s CEO supporting Do Kwon’s Terra re-launch and the new LUNA 2.0 token, however, CZ told Fortune in his interview that he has never spoken directly with Do Kwon.
LUNA 2.0 price could breakout with a rally
Insiders in the LUNA crash and the new Terra chain launch, validators - ThorchainMaximalist and PFC – say they appreciate the vesting of tokens on the blockchain. This will help both the community and builders, as the LUNA 2.0 chain will be different from Terra and most applications should function well on the new blockchain.
Analysts have evaluated the LUNA 2.0 price chart and observed the recent 16% bounce in the token’s price. LUNA 2.0 price recouped its losses, while LUNC continues trending south. Michaël van de Poppe, CEO and founder of Eight Global, argues that LUNA 2.0 price could continue its uptrend and he is interested in long positions once the token flips the $6.60 to $6.80 level.
Got a 16% bounce after losing that support level, but $LUNA is desired to continue trending south. https://t.co/Ozb7vIZVcI pic.twitter.com/n7rxK7ozHn
— Michaël van de Poppe (@CryptoMichNL) June 5, 2022
FXStreet analysts believe shorting LUNA 2.0 token could be a profitable move for holders. For more information, watch this video:
Author
Ekta Mourya
FXStreet
Ekta Mourya has extensive experience in fundamental and on-chain analysis, particularly focused on impact of macroeconomics and central bank policies on cryptocurrencies.
