LUNA’s price soared amid the burn, a move that suggests some investors don’t quite trust a trust is a fiduciary relationship in which one party, known as a trustor, gives another party, the trustee, the right to hold title to property or assets for the benefit of a third party, the beneficiary. Kwon’s plans to revive the project.
Some users of the Earth are burning their tokens LUNA in an attempt to push up the price of that cryptocurrency.
The strategy aims to reduce LUNA’s hyper-inflated circulating supply of more than 6 trillion tokens , with the goal of balancing its supply and demand and hopefully triggering a price spike. According to data from blockchain a distributed ledger system. A sequence of blocks, or units of digital information, stored consecutively in a public database. The basis for cryptocurrencies. explorer Bitquery , a sum of 283 million LUNA have been burned so far.
The term burning destroying a certain number of digital coins to reduce their issue. This method is used to fight inflation and increase the value of cryptocurrency. All token burning transactions are recorded in the blockchain as a transaction. Therefore, anyone can verify that the coins were destroyed. refers to a process to permanently eliminate a crypto asset by taking it out of circulation; reducing its supply and potentially increasing its price. While the tokens cannot be deleted, the process involves sending them to addresses inaccessible to anyone, which in practice is the equivalent of them ceasing to exist for market an area or arena, online or offline, in which commercial dealings are conducted. purposes.
Founder does not approve burning LUNA
The burning of tokens LUNA has increased in recent days in the wake of the dramatic implosion of the LUNA ecosystem. Earth . Two weeks ago, the stable algorithmic currency currency is a medium of exchange that defines value. Land USD (UST) lost its long-awaited peg a “peg” is a specified price for the rate of exchange between two assets. to the US dollar. The unpegging triggered the fall of LUNA, its token a digital unit designed with utility in mind, providing access and use of a larger crypto economic system. brother whose task was to ensure its stable price of USD $1.
In light of the incident, the developers of Earth opted to increase the supply of LUNA in an attempt to save UST and restore its parity. However, these attempts were unsuccessful. UST is trading well below its level at USD $0.06, while LUNA is even lower at USD $0.00017. The cryptocurrency cryptocurrencies are digital currencies that use cryptographic technologies to secure their operation. was trading as high as USD $115 just a month ago.
The founder and CEO of Terraform Labs Do Kwon, who has been at the centre of attention in the midst of the meltdown, listened to recent suggestions from some users to reduce LUNA’s offerings. On Saturday, amid a barrage of questions from the community, Kwon finally agreed to share an address for the burning of the token native. However, he has warned against advising against this practice.
To clarify, as I’ve pointed out several times, I don’t think sending [LUNA] tokens to this address a place where cryptocurrency can be sent to and from, in the form of a string of letters and numbers. to burn tokens is a good idea; nothing happens except you lose your tokens. I want there to be no confusion whatsoever.
To clarify, as I’ve noted multiple times i dont think sending tokens to this address to burn tokens is a good idea – nothing happens except that you lose your tokens
Want there to be no confusion whatsoever https://t.co/GrzG9cclAr
– Do Kwon ???? (@stablekwon) May 23, 2022
The project’s founder clarified his stance two days after sharing the LUNA burning address, clarifying that he provided such an address to users for informational purposes only, but that he does not advise this practice. Other observers, including the CEO of Binance , Changpeng Zhao (CZ) They disagreed, and saw burning as a possible solution.
“ Supply reduction must be done by burning, not bifurcation […] and abandoning all those who tried to redeem the currency. “, dijo CZ changpeng Zhao (CZ) is the founder of crypto exchange Binance. as quoted Cointelegraph .
Distrust over reactivation plan
Despite this advice, a significant number of LUNA holders seem to be disregarding Kwon’s opinions, as the data shows an increase in the amount of tokens burned since the weekend. The actions of some investors to dump a sudden sell-off of digital assets. their coins could suggest distrust in Kwon’s plans to revive the project.
As he has been reviewing DiarioBitcoin In the meantime, a vote is underway on a proposal by Kwon to revive Earth by creating a new version of the blockchain that will leave behind the failed UST and will distribute tokens among LUNA holders. Until now, the general understanding of these plans was that they would be carried out through a hardfork (hard fork) to Earth ; even though the team explained this Monday that the reactivation does not involve this step and instead involves the creation of a new network.
It is possible that the uncertainty surrounding the plans to revive the Earth has generated mistrust among some users, although a survey of the voting shows that the majority seems to support the opposite of Resistance, it is a threshold that crypto’s price doesn’t fall below. the proposal. It should be noted that, on Friday, Kwon made some changes to the proposal while the chain voting process was still underway.
Does it work? LUNA registered an increase
LUNA’s headlines that burn their tokens forfeit any opportunity to be eligible for an upcoming distribution of tokens as the reactivation proposal plans.
Although the move appears to run counter to plans to revive the Earth Some believe that the burn is favoring the price of LUNA as this trend has coincided with a recent, albeit modest, price increase. Over the weekend, LUNA doubled its price from USD $0.00010 to USD $0.00021, although it has dropped to USD $0.00016 by the time of publishing.
It should be noted that the amount of tokens burned is barely a drop in the ocean of LUNA’s circulating supply of 6.5 trillion (one million million million) and equates to less than USD $70,000 at the time of publishing.
Beyond the burn, factors such as widespread expectations around the proposed revival, optimism over a possible price increase, or the cryptocurrency market’s own broader volatility a statistical measure of dispersion of returns, measured by using the standard deviation or variance between returns from that same security or market index. could be behind LUNA’s recent rally.
- South Korean authorities seek to freeze Luna Foundation’s assets
- Binance’s CZ says it’s “poor again”: $1.6 billion Luna holdings down to $2.2 billion
- Mike Novogratz speaks out in the wake of Terra and notes that Galaxy Capital capital is most commonly defined as the large sum of money you would use to invest. also posted significant losses
Article by Hannah Estefania Perez / DiarioBitcoin
Imagen de Unsplash