- The SEC’s order may affect various protocols, including Mirror and Anchor Protocols, which were integral to the upcoming Terrla Luna Classic (LUNC) burn calculations.
- Despite the upcoming burn event, LUNC’s price has remained stagnant, struggling to surpass the critical resistance level of $0.000095.
The Terra Luna Classic (LUNC) blockchain is preparing for a major burn event following a directive from the U.S. Securities and Exchange Commission (SEC). This directive requires TerraForm Labs to burn a substantial amount of LUNC and TerraClassicUSD (USTC).
Terra Luna Classic’s New Burn Initiative
As per the SEC, TerraForm Labs has been ordered to destroy private keys linked to specific blockchain wallets, including those holding USTC, LUNA, Wrapped LUNA, and LUNA 2.0. Thus, the burn event, which could involve up to 275 billion LUNC tokens, will take place by October 31, 2024, reported CNF.
The SEC’s statement noted, “The judgment requires the defendants to burn or destroy private keys in TerraForm’s possession to wallets or blockchain assets holding UST, MIR, LUNA, Wrapped LUNA, and LUNA 2.0.”
This mandate could impact various protocols, including the Mirror and Anchor Protocols, which were central to the calculations for the impending token burn. Given the scale of this burn, it would be a major event for the Terra Luna Classic community after the ecosystem collapse in 2022.
One critical aspect of the SEC’s order is the impact on Terra Luna Classic’s Shuttle Bridge. Holders of assets on the Shuttle Bridge have been advised to withdraw their remaining tokens since the bridge will be closed permanently. The timeline is tight with users having only a few days left to secure their assets before the complete cessation of operations.
LUNC Price Analysis
Despite the burn, Terra Luna Classic’s price action has been relatively flat, leading to confusion among some investors. Despite double-digit gains for Bitcoin (BTC) and Ethereum (ETH) in the last 30 days, the LUNC price has remained below the key resistance level of $0.000095. LUNC price hasn’t been able to claim this level since the beginning of October with the token failing to gain momentum despite a bullish market trend.
One key indicator of market sentiment, the Chaikin Money Flow (CMF), is in negative territory at -0.19 on the hourly charts. This suggests that large investors may be reducing their LUNC positions ahead of the burn event. Moreover, this declining interest is reflected in the token’s low trading volumes.
On the contrary, a significant change was noted today. At press time, LUNC price stood at $0.00009409, gaining 2.93% on Tuesday, October 22. Meanwhile, the 24-hour trading volume skyrocketed by 135.47% to $50.61 million.
Since March 2024, LUNC has fallen below the $1 billion market cap. Moreover, Despite periodic burns initiated by Binance, these efforts have had little immediate effect on the LUNC price. Nonetheless, the ongoing burn initiative represents one of the largest token burns in LUNC’s history and could shift the momentum, reported CNF.
Despite its struggles, Terra Classic continues to see activity in derivatives trading. LUNC recently recorded a spike of 88% in derivatives volume. Binance users have shown increased interest in long positions with twice as many long positions opened compared to shorts, reported CNF. However, this activity has yet to translate into upward price momentum for the altcoin.
Credit: Source link
