LUNC is the perfect example of how cruel and volatile the crypto industry could be. LUNC is the most affected token from the recent price fall in cryptos. LUNC is the native coin of Terra classic and has come down to $0.0001025 after reaching the record high of more than $110 in May 2022. But according to the experts, the currency has seen its deterioration and still has much potential.
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What Is LUNC?
Terra, or many recently changed to terra classic, is the blockchain network solution like Ethereum or Algorand. It was designed in 2018 to provide more stable grounds in the crypto industry. The blockchain network addresses many common issues in other chains and offers low fees, high scalability, stability, and financial assets. LUNC is the native coin of Terra classic that reached its maximum value of $119 in April 2022 before crashing in 2 days to around $0.00001675.
Reasons For The Crash Of LUNC
The main reason for the crash of LUNC is the loss of its link to TerraUSD. The UST coin was originally tied to $1, and the price of LUNC was maintained with UST with the help of mutual burning and minting. When a LUNC coin is minted, UST of 1 LUNC must be burned with the computer program, and if 1 UST is minted, then LUNC with 1 UST must be burned.
When the UST goes below the pegged price, holders can burn it or sell it to get LUNC worth $1 to get a price increase, and when UST goes high, the opposite happens.
The overburning of UST caused to disturb the peg, and more UST were burned or sold. This resulted in excess minting of LUNC that created a demand and supply gap and led to the crash of LUNC and UST.
The Future Of LUNC
According to the experts, the LUNC still has a lot of potentials, and although it can not reach its former height anytime soon, there are high chances that it can gain 5 times its value in 2025. Currently, the price of LUNC is around $0.0001025, and these are the predictions for it:
- The crash is over for LUNC, and it can gain its value to $0.0001878 if things are good. If the market is not in ideal conditions and things are not good, it can still rise to $0.0001220.
- By the end of 2023, the price of LUNC can be between $0.0001620 and $0.000369, with $0.0002809 as the best prediction.
- 2024 can be good for LUNC and reach $0.00064 at maximum. From the pessimistic view, it can go to $0.000301, which is also not bad.
- Many experts believe that LUNC might touch $0.0008153 in 2025, which is more than 7 times its current price.