Terra Luna Classic Price Prediction as the SEC Sues Terraform Labs and Do Kwon – Is LUNC in Trouble?
The Terra Luna Classic price has fallen to $0.00016791, with its 4.5% drop today following the news that the SEC is charging Terraform Labs and CEO Do Kwon “with orchestrating a multi-billion dollar crypto asset securities fraud.” LUNC remains up by 4.5% in the past week, but is down by 4% in the last 30 days, amid a turbulent time for the market as a whole.
Despite the bad news for Terraform Labs and (the still fugitive) Do Kwon, LUNC isn’t directly affected by the SEC’s charges, given that it’s now community-driven. And with plans in motion to re-peg sister stablecoin USTC, it could have a brighter future ahead of it than the newer LUNA token, which was launched by Terraform Labs as part of the revamped Terra 2.0 network.
Terra Luna Classic Price Prediction as the SEC Sues Terraform Labs and Do Kwon – Is LUNC in Trouble?
LUNC’s indicators have responded negatively to yesterday’s news, with the coin’s relative strength index (purple) dropping from 70 a few days ago to just under 40 today. This indicates above-average selling pressure, while the fact that it hasn’t fallen below 30 (yet) signals that the price has plenty of space left to fall before it becomes oversold.
Likewise, LUNC’s 30-day moving average (red) has stalled after looking like it might be climbing back toward its 200-day average (blue). As such, it may continue to dip further before bottoming out.
The key short-term support level to watch is $0.000165, which could signal further falls if it fails. And with Terraform Labs, Do Kwon and Terra, in general, entering the news for all the wrong reasons now, the negative publicity could indeed cause LUNC to drop further.
Today we charged Singapore-based Terraform Labs PTE Ltd and Do Hyeong Kwon with orchestrating a multi-billion-dollar crypto asset securities fraud involving an algorithmic stablecoin and other crypto asset securities.
— U.S. Securities and Exchange Commission (@SECGov) February 16, 2023
While the SEC hasn’t stated what kind of penalty or punishment it may be seeking from its case against Terraform Labs and Do Kwon, it has been pretty damning in its charges.
“As alleged in our complaint, the Terraform ecosystem was neither decentralized, nor finance. It was simply a fraud propped up by a so-called algorithmic ‘stablecoin’ – the price of which was controlled by the defendants, not any code,” said Gurbir S. Grewal, Director of the SEC’s Division of Enforcement.
While Terraform Labs abandoned the original Terra blockchain — and LUNC and USTC — in May, it launched a replacement, Terra 2.0, along with a single native token, LUNA. Accordingly, LUNA has fallen harder than not only most major tokens today but also LUNC, with a 7.5% drop in the past 24 hours.
In other words, LUNA is the altcoin that will really suffer because of the SEC’s case. By contrast, LUNC may be tainted a little by association, but it and the Terra Luna Classic is now more community-driven and decentralized than it was before May’s de-peg collapse.
whew lad, lots to digest in the SEC lawsuit vs Do Kwon and Terraform Labs
— _gabrielShapir0 (@lex_node) February 16, 2023
right off the bat, a very interesting fact is that the SEC is being more thorough than usual–specifically running through the Howey test for various assets (UST, LUNA, and wLUNA) and also alleging that… pic.twitter.com/qHuL6mKpeo
And while we may expect the LUNC price to remain a little depressed in the near term, its longer-term future seems much more encouraging. For example, the now-accepted proposal to re-peg USTC is extremely bullish for the altcoin since re-pegging the stablecoin would necessitate a large-scale burn of LUNC tokens.
This means that LUNC’s burn total — which is currently at 39 billion — will rise substantially once the proposal is put into practice. And with a circulation supply of roughly 5.9 trillion, there really does need to be drastic burning if the price of LUNC is to rise substantially.
It’s also encouraging to note that the Terra Luna Classic community has been taking various other steps to make LUNC’s native blockchain more usable and attractive to adopters. Most notably, the end of the year witnessed the establishment of a task force aimed at boosting Terra Luna Classic development and adoption, something which helped boost LUNC’s price at the time.
There have also been a number of proposals for raising the burn rate in various other ways, including a proposal aimed at increasing the minimum commissions (for validators) to 5% (which could result in more LUNC burning).
Indeed, division within the Terra Luna Classic community has hampered progress on some occasions, yet there’s no doubt that the vast bulk of this community is aimed squarely at making LUNC a more attractive prospect.
The $LUNC burns are heating up 🔥🔥🔥
— Asobs (@Asobs_YT) February 8, 2023
How much will @binance burn on March 1st? 🤔
Data Here: https://t.co/d2fAAbr6FV pic.twitter.com/9dawAkolk3
Accordingly, there’s a real probability that the altcoin could recover to $0.0002 in the next few months, with a rally to $0.0003 or higher possible by the end of 2023. Anything bigger would depend on massive burns, but with Binance also resuming its trading fee burns next month, the total will begin rising noticeably again.
Is Now a Good Time to Buy LUNC?
While LUNC looks good in the future, it may fall a little more in the next few days and weeks. Accordingly, there are other high-potential coins in the market at the moment that do have better short-term prospects. We’ve reviewed them in a list of the top 15 cryptocurrencies for 2023, as analyzed by the CryptoNews Industry Talk team.
The list is updated weekly with new altcoins and ICO projects, so be sure to check back for new entries.
Disclaimer: The Industry Talk section features insights by crypto industry players and is not a part of the editorial content of Cryptonews.com.
