Will Luna Recover or Will LUNC Go Up?

Will Luna Recover or Will LUNC Go Up?

Will Luna Recover? After struggling against major cryptocurrencies for most of January, Lunc is pumping after the USTC Repeg proposal is on the verge of passing


After the Industry numbing shock of the Terra Luna crash in May, Terra Luna’s recovery has been a major story since July. With the fork in late May, there are two Luna Tokens now. The original Terra Luna token is now Luna Classic while a new token called Luna 2.0 was also launched. While it was expected that investors would back the new Terra Luna, the reverse happened. Luna Classic is now 5x larger in Market Cap than Luna 2.0. The question is, is this Terra Luna recovery sustainable and real? Read on.

Why did Luna Crash?

  • The Terra UST was an algorithmic Stablecoin backed by Terra Luna Token
  • $2B worth of UST was unstacked from Anchor and sold in the market. This led to a de-pegging of UST from the dollar
  • As a consequence, many consumers began to convert their UST (worth less than a dollar) with a dollar worth of Luna
  • This led to billions of dollars worth of Luna being mined.
  • The cycle of further UST Selling continued leading to the mining of billions of Luna which in turn crashed the price of Luna as well.

Will Luna Classic Recover? Performance to date since Fork

Luna Classic Performance May-September

  • Luna Classic: +306.7%
  • Luna 2.0: +15.3%
  • Bitcoin: (-8.3%)
  • Ethereum: (-3.5%)

Luna Classic Outperformed every single cryptocurrency between May to September

LUNC Performance October- February

  • Luna Classic: (-38.8%)
  • Luna 2.0: (-9.3%)
  • Bitcoin: +21.2%
  • Ethereum: +27.1%

Luna Classic Underperformed most cryptocurrencies between October and February.

Notable event: The Luna Classic USTC Repeg Proposal has passed

Will Luna Recover?

This question is particularly intriguing for two reasons. Firstly, Luna Classic was actually on a path of recovery between May and September. However, after the Burn tax was rolled out, the recovery has not only stalled but the crypto is down by more than in the last 3 months. So the big question is if Luna will recover or if it is at a dangerous place now.

Luna Classic’s Price recovery will depend on a few factors:

  • Macroeconomic environment
  • Development of Luna Classic Eco-system
  • Differentiation versus competition

Among the above three factors, the macroeconomic environment is not in control of the Luna Classic Community. So let us focus on the other two

The Luna Classic Ecosystem

  • Here is the latest list of Luna Classic Ecosystem. Many of them are not active on the Terra Classic blockchain. While a precise number is unavailable, it is unlikely to be in the double figure. On the other hand, the forked Luna 2.0 has a reasonably extensive list though it is doubtful that many are active there either. One of the agendas of the more technically minded community members was to find a way to ensure Luna 2.0 DApps were also present on Terra Classic. However, limited progress has been made as the top agenda item was moving Infrastructure control into the hands of the community. At the moment, there isn’t enough money to complete that transition.
  • After some failed attempts, most community voices have returned to pushing for more burning. Given the results of the last 3 months, it isn’t very likely to yield results.

Differentiation

Without the ecosystem, there is no standout as far as Luna Classic is concerned. There are numerous tokens with better use cases and a focus on developing the ecosystem. In fact, there is increased pressure on new tokens to enable numerous use cases.

So at the moment, one can say with confidence that, current community activities will NOT spur a recovery in Luna Classic price. Luna Classic could still recover due to market conditions improving but that would be in line with the market and not the outperformance as seen between May and September.

Will Luna Classic Recover? Have we reached the Crypto market bottom?

Over the last few weeks, the cryptocurrency market has recovered significantly. However, we also notice significant layoffs in the United States which will eventually play out in the form of consumption, liquidity, and investments. It is therefore difficult to say if we have reached the Cryptocurrency market bottom

  • No visibility on when the Federal Reserve will stop rising rates given the continued rise of Personal consumption
  • Cryptocurrency industry scandals are likely to recur given the lack of regulation. This period in particular.

Our view is the Cryptocurrency market could see further downside over the next few months (2018 Precedent).

Read: Terra Luna Classic Price Prediction 2023, 2025, 2030 and 2040

Will LUNC Go Up? Analysis of recent performance

LUNC Monthly Performance

  • September: +29.5%
  • October: -17.3%
  • November: -36.6%
  • December: -10.6%
  • January 2023: +13.9%
  • February 2023: +17.7%

In the last 6 months, LUNC has gained in 3 months and has traded negatively in the other 3 months. In October and November combined, LUNC lost over 50% of its value. However, after continuing to crash in December, LUNC has had two great days and has begun to move higher.

Will luna classic recover to $1

Could Luna Go back up again?

There are 3 major factors that will determine if Luna Classic goes back up again

  • Government regulation
  • Macroeconomic Factors
  • Token Utility

Potential Use Cases for Terra Luna Classic

Why Luna Classic should focus on DeFi

  1. Historical reasons: The original Terra Luna was a huge player in DeFi until May 2022. Numerous DeFi players like Anchor and Risk Harbor lost massive value in the Crash of May 2020.
  2. DeFi’s Growth opportunity is huge
    • The need for Decentralized finance (DeFi) will continue to rise not just in the United States but also all over the world as consumers look for ways to borrow money with the lowest hassle or invest in assets with the highest return and lowest risk. DeFi-based products are attempting to solve this problem. For example, traditional secured lending (Like borrowing against deposits or other liquid assets like shares or mutual funds) is under threat from DeFi-based lending. So, a consumer can borrow against their crypto assets for an unlimited period and a small fee as long as the value of their cryptocurrency is higher than the value of the capital borrowed.
    • In the same process, a person can also involve in a form of lending (not P2P) by contributing to the lending pools and earn a healthy return.
    • Unlike traditional finance, the technology and algorithms along with proof of consensus validators run and operate this process as opposed to middlemen (and women) that drive many of these practices and processes in traditional lending companies and banks.

Can Luna Classic operate in the NFT Space?

Miata, an NFT Marketplace launched in November 2022 on Terra Classic. In two months, traffic on the website has been rising (even if it is minuscule).

MetaGloria another NFT game is set to launch on Terra Classic this year.

The Terra Classic blockchain is built using the Cosmos SDK. Binance, Crypto.com and ATOM are also built using the Cosmos SDK. BNB is ranked 7th while Cronos is ranked 16th on NFT Sales. When compared with Solana, Cosmos is slower and also costlier. So while it is possible to launch NFTs on Terra Classic, there are better options in the market. That said, Cosmos is better than Solana on interoperability and that gives Terra Classic the edge.

So Which Use cases should LUNC focus on?

The more influential folks in the Luna Community have been toying with the idea of accessing the DeFi apps already on the Terra Luna 2.0 platform. Some argue that it is quite straightforward and involves activating Inter-block communication (IBC). IBC enables the creation of cross-chain decentralized applications and the use of different blockchain networks to access different DeFi services. But in practice, this involves other blockchains willing to share access to these services both technically and as a strategy. At the moment this is a work in progress.

NFT will continue to be of interest for Terra Classic but perhaps not its biggest strength.

Luna Classic Outlook Today

Overall OutlookPartially Positive
1. Market's WisdomPartially Positive
1a. Market DataNeutral
1b. Technical RecommendationBuy
2. Crowd's WisdomNeutral
2a. Social Media BuzzSteady
2b. Social Media SentimentNeutral

Would Luna ever recover – New Government regulations?

Government regulation – With the crash of FTX in November and Luna earlier, there is an increased chance of Government regulation. The SEC vs XRP case will determine whether such regulation will come via court precedents or via new laws. New laws are likely to be focused on increased transparency on token ownership (KYC, Share), voting rights, and taxation. This will help well-designed tokens and impact many of the tokens that are adding zero value and /or are mostly owned by the Founders themselves.

Will Luna Classic Recover? Macroeconomic Factors

  • Inflation has begun to fall and is below 7%, it is likely that rate hikes will ease a little but unlikely to stop before inflation falls below 4%
  • Crude Oil is hovering below $90 and has been rising in anticipation of the recovery in China’s economy
  • Layoffs in the United States have risen over the last few weeks
  • While Inflation has fallen, there isn’t too much good news in the economy.

Will Luna recover? Token Utility

  • The community has organized really well and has accomplished a lot of milestones between June and September. This included Getting new validators and working hard to get the governance mechanisms in place. The community is central to LUNC’s success. 
  • However, the community has not accomplished much after Burn was rolled out. There is a need for capital to develop the ecosystem for developing and sustaining use cases in the blockchain. Many of the technical papers written by developers have not won the support of the community yet.

Can Luna Classic Recover? $LUNC vs $LUNA Trading Volumes

LUNC tends to dominate for fewer days in a month but pumps much harder than $LUNA. For example, LUNC has had 13 days when Volume had risen above $1 B since July. It was just 8 days for $LUNA. This volatility is strongly connected to newsflow and community activities which is absent in the case of $LUNA.

In the meanwhile, LUNA 2.0 is getting stronger by the day. January was the best month for LUNA 2.0 since August 2022. However, LUNC picked up momentum over the last few days.

Days LUNC was aheadDays LUNA was ahead
February4 days0 days
January17 days14 days
December31 days0 days
November29 days1 Day
October28 days3 days
September25 days5 days

Read: Cardano Price Prediction

Will Luna Recover? What about Trading Volume?

Looking at the $LUNC volume data for the last 31 days, LUNC price is dependent a lot more on Market Sentiments rather than trading volume. This could imply that the risk of LUNC crashing is much higher than before should market sentiments turn bad. The good news is that the price has remained stable over the month.

Will Luna Recover or Will LUNC Go Up?

Will Terra Luna Classic recover?FAQs

Will Terra Recover?

Both the Terra tokens have a good chance of recovery. While Luna classic has the investor base and community to help it recover, Terra Luna 2.0 has the ecosystem and use cases to propel it forward.

How will Luna recover going forward?

At the moment, the only factor in the control of the community is delivering more use cases. This is a work in progress and the community is making very slow progress.

Should you sell $LUNC?

LUNC is likely to go down further in the short term after rising a little due to the Binance announcement. Secondly, there is no guarantee it will immediately rise again. However, a massive pump is highly likely if the community delivers another innovation. The community is stalled at the moment but is unlikely to remain so over the next 4 weeks. A sell or buy decision is therefore completely dependent on the willingness to lose some money in the hope of gaining a lot.

Will Luna Crypto Recover?

Yes, there is a reasonable probability that LUNC Crypto can recover. However, the recovery will depend on multiple factors – Government regulation, increased liquidity, and increased use cases in the Luna Classic ecosystem. At the moment, there is increased uncertainty on each of these metrics.

Will Luna Classic BURN alone be enough for Luna Classic’s recovery?

LUNC is in a competitive market where buyer interest depends on the demand for Luna Classic coins. Burn is a method to destroy supply and not increase demand. Supply restriction can drive prices higher only to a certain level. Instead, how the LUNC community can create demand for SHIB over the next few weeks in terms of a consumer/ business proposition will determine if LUNC heads to $1

Can Forked Coins like Luna Classic perform well?

As you are aware, Ethereum is a hard fork from Ethereum Classic and Ethereum Classic is now open source. While ETH has grown 579% in the last 5 years, ETC has delivered a 292% return. But ETC did peak at a 1000% plus return between 2017 and 2021.

Will Luna recover to $100?

It will take more than 46 years to reach $1. So it is fair to say that Luna is unlikely to recover to $100

Will Luna rise again?

Yes, Luna could rise again as the macroeconomic environment is improving a little. However, it is unlikely to be sustainable as numerous experts are predicting that the macro environment will worsen again next year. Secondly, with the LUNC community failing to develop new Use cases or partnerships, token usage is unlikely to rise in 2023. So even if Luna rises in 2023 due to favorable economic conditions, it is unlikely to be a top-performing token.

Will Luna Coin have a future?

While the probability of Luna Coin rising in price is moderate, it is difficult to say if the coin has a future in the medium to long term. While considering a slightly longer period of time, other factors come into play. Number 1 is Technology change. It. is unclear how blockchain technologies and tokens will evolve 5-10 years down the line. Two, regulatory. The regulatory environment will surely change as politicians would want to play saviors for unprepared voters. Thirdly, the competitive environment. With thousands of tokens at present, it is unclear how many will eventually survive.

In Sum, the chances of $LUNC recovering are good as the overall cryptocurrency market has also begun a path of recovery. However, should the community activities stall, it could end the cryptocurrency fairly quickly.

Note: Crowdwisdom360 collates Predictions and data from all over the net and has no in-house view on the likely trends in the Stocks or Crypto Coins. Please consult a registered investment advisor to guide you on your financial decisions.

Will Luna Classic Recover? $LUNC Falls below $0.00006 as Development team begins to take shape
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