Terra has endured a turbulent period in recent weeks and has been the most affected during the cryptocurrency market crash. However, Terra’s token, LUNA, gradually rose from the dust after its market capitalisation and price fell.
The cryptocurrency saw its price dip to a low of $0.00000099. As a result, its market capitalisation dropped below $60 million on May 13, 2022. However, the token has picked up once again as the Terra team prepares to make investors whole again.
In addition, the cryptocurrency’s market capitalisation recorded a boost above $1 billion as investors massively purchased the cryptocurrency to become beneficiaries of the upcoming LUNA airdrop.
The heavy purchase of cryptocurrency by investors caused by the upcoming airdrop has influenced the price and market capitalisation positively, making it grow exponentially.
In the past 48 hours, LUNA has increased over 100% in price, from a low of $0.0001037 to a high of $0.0002159. At press time, the price has fallen slightly to $0.000193. That surge in price helped the market cap as, at press time, LUNA’s market capitalisation currently sits at $1.2 billion, according to data on cryptocurrency aggregator platform Coingecko.
LUNA Price Boosts
The rapid boom of LUNA’s market valuation has also caused asset class prices to increase. Following the surge of LUNA’s market cap, the token price has shot up from its May 13 low of $0.0000009 to $0.000193, which suggests that LUNA has only three zeros to eliminate before it reaches $1.
While LUNA could surge to $1 before the upcoming Terra 2.0 goes live on May 27, 2022, its circulating supply still holds the token back.
Many investors withdrew the token from different pools and dumped them in the market after LUNA’s fall, further contributing to its price crash.
LUNA’s circulating supply surged from 300 million tokens to nearly 7 trillion in just two weeks. There are currently 6.53 trillion LUNA tokens in circulation at press time, which raised further doubt about the possibility that LUNA would hit $1 before the new Terra chain launches.
UST Remains Stagnant
Meanwhile, Terra’s stablecoin TerraUSD (UST) struggles to regain its peg to the U.S. dollar. The stablecoin is trading at around $0.06 across exchanges with a market capitalisation of $746 million.
UST declined 2.6% in the last 24 hours, with very little activity recorded for the stablecoin in the past day.
Furthermore, the stablecoin has not recorded a significant rise in market capitalisation like LUNA because the team is more focused on compensating the latter’s investors.
Most Terra investors favour creating a new chain and LUNA tokens without the algorithmic stable coin.
However, the proposal to burn UST failed to execute due to technical issues, as the team made another effort at making the stable coin valuable once again.