Terra grows at full speed with TVL over $ 1.9 billion and LUNA price up 50%
The Terra blockchain project and its native token LUNA quickly grew from an unfamiliar name to a DeFi lead. With TVL over $ 1.9 billion, it is the fifth largest blockchain project after Avalanche.
With some major fundamentals going on, the LUNA price has risen over 50% in the past week. Industry insiders believe this is just the beginning of the “giant” bull run that will take place in the coming weeks.
Motivational causes big rally of LUNA
After Bitcoin slumped last week and dropped near the USD 50,000 resistance, the rest of the market was also in the red. However, that doesn’t seem to affect LUNA.
The Layer 1 blockchain platform has quickly risen to the top of DeFi and has sparked a huge wave of interest in their innovative stablecoin products. Terra allows users to exchange LUNA for a variety of stablecoins pegged to different fiat currencies. Since 1 dollar LUNA is burned for every 1 dollar minted UST, the increasing supply of stablecoins on Terra reduces the circulating supply of LUNA and thus increases its value.
This simple proposal attracted more than 3.2 million registered accounts and paid out 15.3 million UST tax bonuses over the past year.
Earlier this month, the Terra community approved a proposal to burn 88.7 million LUNA tokens, valued at about $ 4.5 billion at the time. This decision was made to mint between 4 and 5 million UST. Accordingly, analysts believe that interest in Terra will continue to grow.
As expected, the token price has increased more than 50% since last week, largely thanks to a number of suggestions newly approved by the municipality.
LUNA price chart from October 1 to November 30, 2021 | Source: TradingView
The ultimate destination for everyone suggestions Recently a request was made for UST to become a cross-chain stablecoin. The process begins by increasing UST liquidity on Curve Finance (Ethereum’s leading automated market creation platform) for stablecoin swaps through a 6-month incentive plan for select Terra apps.
All previous LUNA Burns have significantly increased the annual staking return for the token, from 4.61% at the beginning of November to 10.74% at the end of the month.
Benefit Mark out annually for LUNA from November 1st to November 30th, 2021 | Source: Terra Dashboard
According to Nicholas Flamel, one of the prominent members of the Terra community, LUNA’s price will continue to rise in the coming weeks.
“Terra’s economy is growing at full speed. I’m pretty confident that the story is just beginning. “
Flamel says both the Terra community and development team expect UST to reach a market cap of $ 10 billion by the end of the year. And since the minting of 1 UST requires the burning of 1 dollar LUNA, the terra ecosystem moves into a parabolic shape.
“That means we’ll have to buy / burn LUNA worth about $ 2.5 billion over the next 4 weeks. One of the numbers is not small at all. I’m not sure we’ve seen so much pressure to buy a coin like this before. “
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