A Gem?
A gold?
#LUNC
122,000,000% if it reaches its maximum potential.
The cryptocurrency Terra Classic (LUNC), formerly known as Terra (LUNA), suffered a dramatic devaluation due to a series of catastrophic events that shook investor confidence and destabilized the currency's ecosystem. Here are the details and reasons behind this devaluation:
History of Terra Classic (LUNC):
Terra Classic (LUNC) was originally created to be the native token of the Terra blockchain, with the aim of stabilizing the price of the TerraUSD (UST) stablecoin.
UST was an algorithmic stablecoin that was supposed to keep its price pegged to the US dollar, creating and burning UST and LUNA tokens to balance supply and demand.
Collapse of the Earth Ecosystem:
In May 2022, the UST token lost its dollar peg and entered a hyperinflationary spiral. The algorithm responsible for backing up UST created trillions of tokens, which drastically decreased the value of the cryptocurrency.
The collapse was so significant that it is considered one of the biggest, if not the biggest, token collapse in the history of cryptocurrencies.
During the collapse, the Terra blockchain had to be stopped twice, and the price of LUNA, which stabilized UST, fell almost to zero.
Hard Fork and Rebirth:
After the collapse, founder Do Kwon and part of the community decided to try to revive the Terra project, resulting in two Terra blockchains operating in parallel.
The original Terra network was renamed to Terra Classic (LUNC), and a new blockchain was launched with the native token called Terra (LUNA).
Extreme Devaluation:
The devaluation of more than 122 million percent reflects the loss of confidence and hyperinflation of tokens that occurred following the decoupling of UST from the dollar.
The price from $119.1846 to $0.00009696 illustrates the volatility and risks associated with cryptocurrencies, especially those that rely on algorithmic mechanisms to maintain stability.
