Many online trolls are encouraging people to buy Terra Luna Classic (LUNC-USD) with false rumors about burns. However, the burning of LUNC is minimal, and isn’t enough to affect the price of LUNC. Alongside trolls, many have also gambled into LUNC thinking it would go up. Some of them are now encouraging others to buy so they can cash out with minimal losses.
Moreover, the stablecoin associated with LUNC, UST Classic (USTC-USD), has also lost almost 99% of its value, currently trading at 1.2 cents. The USTC stablecoin was one of the primary reasons people invested in LUNC in the first place. Unfortunately, investors will no longer be investing in USTC due to its declining value.
Terra Luna Classic
Terra Luna Classic Is Simply Another Failed Project With No Prospects
The Terraform Labs developers have moved on to a new project called Terra Luna V2 (LUNA-USD), and the old project will remain as is with negligible updates. LUNC already lacks utility, and the lack of development on the chain leaves no room for further expansion.
Furthermore, Terra Luna Classic now resembles a meme coin due to its massive supply of 6.5 trillion coins. As a result, its price at around six one-thousandths of a penny may look like a discount compared to its all-time high of $119. However, the coin still has a $390 million market capitalization. I believe it is set to decline even more, as nearly half a billion in market cap for a failed project is simply unjustifiable.
Do Not Take Risks a Second Time With Terra Luna V2
Investors should avoid the second Terra Luna project too, at least for now. The second project lacks any long-term strategy to add utility to the network. Any efforts to do so will be an uphill battle considering Luna V2 no longer has a stablecoin, which made it rise in the first place.
Terra Luna V2, currently at $3.50, has already declined 82% from its all-time high. Without a stablecoin, Terra Luna V2 is no different from dozens of other proof-of-stake (PoS) blockchains. Therefore, its $741 million market cap could decline even more.
In addition, the response from LUNA’s developer, Do Kwon, is still lackluster, especially with his Twitter (NYSE:TWTR) account now going private. With so many people losing money in the first project, the lack of accountability and transparency isn’t a good show. Investors won’t invest if they are kept in the dark. Especially with what has unfolded with LUNC.
Don’t Buy Terra Luna in the Current Bear Market
Bitcoin‘s (BTC-USD) dominance has increased over the past few weeks, and it is a clear sign that you should avoid altcoins such as Terra Luna. Both LUNC and LUNA are now moving in correlation, and so are their declining prospects as investors continue to lose faith.
Even if the market manages to reverse its trends, it is unlikely that either of the Terra Luna tokens will be exceptional in profitability. You can invest in many cryptocurrencies that have better prospects and utility than Terra Luna. In addition, those projects are highly trusted by investors.
If you wish to invest in cryptocurrencies now, I strongly recommend sticking to just Bitcoin and Ethereum (ETH-USD). If Bitcoin continues to face rejections at $30,000, it is an excellent strategy to stake stablecoins compliant with regulations such as USD Coin (USDC-USD) until the market starts to recover.
On the date of publication, Omor Ibne Ehsan did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
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