Terra sees $ 185 million monthly burn of LUNA tokens
LUNA, the native cryptocurrency of a project called Terra, recently experienced a price spike of nearly 80% over the past week. The protocol, created by a team of South Korean developers, even managed to outperform another flagship project, Polygon (MATIC / USD), formerly known as Matic Network. In doing so, Terra became the third largest DeFi project by Total Locked-In Value (TVL).
LUNA, as some may already know, is part of an algorithmic balancing system that is actually used to help stablecoins launched on the same protocol stabilize their prices. Yesterday the token managed to hit the price of $ 33.39 which is its all-new all-time high. The project provides incentives to exchange LUNA for Terra Stable Coins whenever there is a need to increase or decrease the supply of Stable Coins.
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LUNA has seen a sharp increase over the past month, ascend by a total of 460%. Its TVL climbed to $ 6.21 billion, making Terra the third largest blockchain, second only to the two industry leaders, Ethereum and BSC.
Terra sees massive amounts of positive developments
A lot of things led to this sharp increase, including LUNA’s many listings on major exchanges, including Coinbase Pro, which listed both the Ethereum version of the token called Wrapped Luna (WLUNA), as well as Terra’s stablecoin. , TerraUSD. Then there was the recent launch of a bridge protocol called wormhole, which connected Solana (SOL / USD) to other blockchains, Terra included.
This particular move was aimed at activating tokenized assets and making it easier for NFTs to move between different chains. The idea, as well as the bridge itself, enjoyed great popularity and received a lot of attention. On top of that, there was the option of using Ethereum as collateral on the Anchor Protocol – Terra’s own lending and savings platform.
Thanks to its connection to TerraUSD, the more demand the stablecoin sees, the more LUNA tokens are burned. This reduces the circulating supply of LUNA and causes its price to increase, which is exactly what has happened here.
The project is expected to see even more activity in the coming weeks as it is set to roll out a new upgrade known as Columbus-5, which will be followed by many new projects scheduled to go live on Terra.
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