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Uncategorized

LUNC Burning Mechanism That Caused The Most Recent Market Pump Has Big “If”

September 11, 2022 - Around 2 mins mins to read

The plan to tack on a 1.2% burning fee to every network transaction was what drove LUNC’s exponential rise at the start of September.

LUNC Burning Mechanism That Caused The Most Recent Market Pump Has Big "If"
LUNC Burning Mechanism That Caused The Most Recent Market Pump Has Big “If”

Investors eager for exposure to the deflationary asset poured billions of dollars into the project, but there is a catch. If centralized exchanges accept the burning fee, the proposal claims that the burning volume would approach $4 million in a single day. This is where possible issues for Luna arise.

The daily burning volume is now only $55,000 thanks to a statement made by one of the major exchanges in the world, Binance, informing their users that they will not impose the fee.

Less than $100,000 in daily burning volume is negligible for a project with a $3 billion market capitalization and will not have any impact on the token’s market value.

Currently, using the network is almost free, and adding a price for transactions will make users’ activity even less active. Since at one point the network’s activity exceeded the total circulation, the on-chain data shows some evidence of manipulation by validators who purposely boosted the number of transactions on the network.

All of these indicators indicate that the preceding spike was based on dubious proposals and on-chain manipulation, which will not have the expected impact on the token’s market value given the actions that centralized exchanges are taking.

On Sept. 15, $34 million worth of LUNC tokens were released

LUNC Burning Mechanism That Caused The Most Recent Market Pump Has Big "If"
LUNC Burning Mechanism That Caused The Most Recent Market Pump Has Big “If”

A critical concern is raised by the release of $34 million worth of LUNC tokens on September 15: Who will purchase the entire volume pushed into the market? Due to relisting and a lack of data that would indicate a previous catastrophic decline, Binance was mostly responsible for the spike in trading volume that we previously saw.

DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.

Join CoinCu Telegram to keep track of news: https://t.me/coincunews

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Annie

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Annie

Championing positive change through finance, I've dedicated over eight years to sustainability and environmental journalism. My passion lies in uncovering companies that make a real difference in the world and guiding investors towards them. My expertise lies in navigating the world of sustainable investing, analyzing ESG (Environmental, Social, and Governance) criteria, and exploring the exciting field of impact investing. "Invest in a better future," I often say. That's the driving force behind my work at Coincu – to empower readers with knowledge and insights to make investment decisions that create a positive impact.
Uncategorized

LUNC Burning Mechanism That Caused The Most Recent Market Pump Has Big “If”

The plan to tack on a 1.2% burning fee to every network transaction was what drove LUNC’s exponential rise at the start of September.

LUNC Burning Mechanism That Caused The Most Recent Market Pump Has Big "If"
LUNC Burning Mechanism That Caused The Most Recent Market Pump Has Big “If”

Investors eager for exposure to the deflationary asset poured billions of dollars into the project, but there is a catch. If centralized exchanges accept the burning fee, the proposal claims that the burning volume would approach $4 million in a single day. This is where possible issues for Luna arise.

The daily burning volume is now only $55,000 thanks to a statement made by one of the major exchanges in the world, Binance, informing their users that they will not impose the fee.

Less than $100,000 in daily burning volume is negligible for a project with a $3 billion market capitalization and will not have any impact on the token’s market value.

Currently, using the network is almost free, and adding a price for transactions will make users’ activity even less active. Since at one point the network’s activity exceeded the total circulation, the on-chain data shows some evidence of manipulation by validators who purposely boosted the number of transactions on the network.

All of these indicators indicate that the preceding spike was based on dubious proposals and on-chain manipulation, which will not have the expected impact on the token’s market value given the actions that centralized exchanges are taking.

On Sept. 15, $34 million worth of LUNC tokens were released

LUNC Burning Mechanism That Caused The Most Recent Market Pump Has Big "If"
LUNC Burning Mechanism That Caused The Most Recent Market Pump Has Big “If”

A critical concern is raised by the release of $34 million worth of LUNC tokens on September 15: Who will purchase the entire volume pushed into the market? Due to relisting and a lack of data that would indicate a previous catastrophic decline, Binance was mostly responsible for the spike in trading volume that we previously saw.

DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.

Join CoinCu Telegram to keep track of news: https://t.me/coincunews

Follow CoinCu Youtube Channel | Follow CoinCu Facebook page

Annie

CoinCu News

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