Terra, an open source blockchain platform for algorithmic stacked coins, has been on fire for the past six months or so. The value of the original LUNA crypto asset has risen from $24 to over $100 in the past six months, making it one of the top 10 cryptocurrencies by market value.

And while LUNA showed minor corrections here and there, the coin and the Terra project as a whole continued to grow from strength to strength. As of now, on March 4, the total value of LUNA Ether (ETH) has changed dramatically, with LUNA on the platform worth $29.5B compared to $25.9B in ETH.

Additionally, Terra’s raw data shows that there are currently over 230,000 winners in the ecosystem, making it the second most invested cryptocurrency with more than four times the number of those pegging ETH to 54,768. Finally, in terms of rewards for yearly efforts, LUNA gives an average of: Annual return is about 6.62% and ETH reaches 4.81%.

LUNA is up over 350% in the past 12 months and a number of critics continue to argue that Terra’s growth mentioned above could be unsustainable. In fact, people connected to the ecosystem – with both advantages and disadvantages – put a lot of effort into where LUNA will operate this time next year.

The million dollar effort that made Terra. social upheaval
LUNA is up over 350% in the past 12 months and a number of critics continue to argue that Terra’s growth mentioned above could be unsustainable. In fact, people connected to the ecosystem – with both advantages and disadvantages – put a lot of effort into where LUNA will operate this time next year.

A crypto trader with the pseudonym “Sensei Algod” is so bearish on Terra that he recently bet $1,000,000 that LUNA would trade at a lower price by March 14, 2023 than it was on the date at $88. Algod’s offer was quickly accepted by Do Kwon, CEO and founder of Terraform Labs, the company behind Terra, who also offered the same amount, stating that the cryptocurrency would definitely be trading above $88 by then.

As conversations escalated between them via Twitter, the duo finally decided to seek the services of Kobe, the co-host of the UpOnly crypto podcast, who would act as a deposit agent to streamline the entire deal. To illustrate this, Kwon and Algod held a total of $1 million each in Tether (USDT) in an Ethereum address called “Cobie: LUNA Bet Escrow.”

Kobe: LUNA Bet Escrow. Source: Eterskan.
Kirill Nikolov, head of DeFi strategy at Nexo, a blockchain-based lending platform, told Cointelegraph that while such stakes can generate a lot of interest, they don’t matter overall. He added that the developers will continue to develop Terra regardless of the price of LUNA or whether Do Kwon loses the bet.

A similar sentiment is shared by Derek Lim, head of Crypto Insights for crypto exchange Bybit, who told Cointelegraph:

“I don’t think we can or should look into it much. It would be an exaggeration to think that this bet between private parties could mean anything malicious or bullish. Instead, we should focus on other factors such as project return sustainability. reserve. “.
Daniel Santos, CEO of Woonkly, a decentralized finance (DeFi)-based social network, believes these efforts show the growing popularity of LUNA. “The more popular the project, the more fans and haters it has. The hater bets against LUNA and the founder of Terra takes the bet, and why not – it’s as simple as that,” he told Cointelegraph.

Is Terra’s growth really sustainable?
While Terra’s growth looks very impressive on paper, especially since LUNA is changing ETH in terms of total value and the number of shares they own, Nikolov noted that there is a significant difference in the two projects’ gaming model, given that investors cannot withdraw funds. . tied ETH and its rewards before the release of Ethereum 2.0. “Therefore, it is only natural that only a small percentage of the total supply of ETH is enriched compared to LUNA,” he added.

In addition, Nikolov noted that Terra has done a good job of recognizing the need for liquid storage solutions to create a stable and scalable demand that can also be used for guarantees, adding:

“Once the Eth2 consolidation is complete, we can expect the percentage of tied ETH to be similar to that of LUNA, with floating rate solutions like Lido playing a major role in creating linked ETH interest rates like collateral).

Source: CoinTelegraph

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