Terra Classic (LUNC), the original chain of the collapsed Terra (LUNA) ecosystem, has lost its momentum in the last week that saw the asset rally despite the general crypto market trading in the red zone. After rallying from around August, LUNC is witnessing a sustained capital outflow as investors focus on whether the token will rally again.
In particular, as of October 25, LUNC’s market capitalization stood at $1.53 billion, which is a drop of $100 million from the $1.63 billion recorded on October 18, according to CoinMarketCap data.
The selling pressure in LUNC has partly impacted the token’s value in establishing a bearish momentum during the seven days. By press time, the token was valued at $0.00023, dropping over 11% in a week.
LUNC’s fading interest
Interest in LUNC has taken a significant nosedive after weeks of sustained growth powered by several initiatives like community short squeezes. It can be argued that the effects of the general market are now catching up with LUNC after investors in the assets took out the profit.
Additionally, LUNC’s selling pressure has coincided with the ongoing tussle between South Korean authorities and Terra founder Do Kwon. With an arrest warrant issued against the founder, authorities maintain that Kwon, who is on the run, is answerable for the collapse.
At the same time, the drop does not come as a surprise, considering that the May collapse dented the Terra ecosystem’s chances of ever reaching its full potential. However, the token still controls a significant capital with a section of the community maintaining Terra remains a good project and can be saved.
Notably, the LUNC was projected to collapse but continued to attract investors’ interest courtesy of factors like support from leading crypto exchanges. At the same time, the developer community implemented several mechanisms, like controlling the supply through the burn mechanism.
What next for LUNC?
With the reduced utility, it remains to be seen if LUNC will have the power to rally again, especially if the market embarks on a bull run. Furthermore, community initiatives to have LUNC take the approach of meme coins like Dogecoin (DOGE) will be tested.
Overall, the future of Terra Classic remains gloomy, but the community remains upbeat considering potential catalysts like the LUNC tax system, the de re-peg plan, and the vibrant community.
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