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Luna 2.0: Will It Rise or Fail?

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Luna 2.0 was an emergency plan adopted right after the LUNA crash by voting. Everything looked quite bright, but the LUNA 2.0.’s price didn’t. The Luna 2.0 price is quite volatile, as it was since its launch. It’s moving drastically between the $2-$4 price range. Since being at $19.54 near launch, it crashed an immense 89% to a low of $1.98 on June 8.

Here are some reasons why the LUNA 2.0. price will be rather difficult to recover in a short-term perspective. 

Massive starting purchasing of a freshly minted coin: the situation was triggered by the lack of any kind of compensation for Luna and UST holders apart from issuing of a new coin. The holders ran to sell newly issued LUNAC and USTC coins to compensate for the loss.

The issuance of the new tokens was divided into several steps — 30% of tokens were airdropped immediately and the rest, 70%, in 2 years time period. This is believed to artificially support the price from an instant crash. The token’s holders are forced to hold the token. Even in the case of selling the tokens, 70% is far ahead. 

Banal mistrust and lack of individuality of a newly created blockchain: Terra is a swift blockchain with low fee transactions, and the $UST made a difference compared to other blockchains. The new platform was launched without UST. So, why on earth should users trust the newborn project with a spot on its reputation? 

Other blockchains added some fuel to the fire: Polygon and other networks launched funds to help projects move from the Terra blockchain. 

The team’s detachment: the handing of a new network over to the community probably hints that the team is no longer interested in the project’s development. The loss compensation debt was covered by airdropping.

Law Issues: There were investigations made by The Supreme Prosecutors' Office of the Republic of Korea and The U.S. Securities and Exchange Commission (SEC) accused of financial fraud. 

The crypto market crisis: The crypto market is still decreasing, and even new strong projects don't show any of growing as everybody expects Bitcoin's continuous dropping.

Presumably, Bitcoin's return to the rising trend will allow LUNA 2.0. gain some profit in 2 years' time.


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