Terra means earth. However, the price of Terra (LUNA) / USD is not particularly grounded these days. Rather, the altcoin price seems to be losing its grip and entering new spheres. In just one week, the price has exploded by around 68 percent.

Advertising

Among the top 20 cryptocurrencies by market capitalization, no one has recorded a stronger trend than Terra in the same period. Thus, the altcoin knapp beats Solana, who has also made an impressive increase in the past seven days with about 67 percent. Kryptoszene.de has reported in another article about the reasons for the rise of Solana.

In addition, Terra also outperforms the top coins XRP, Cardano and Dogecoin, which can also shine with considerable increases of 52 percent, 45 and 33 percent. In comparison, the lead currency Bitcoin only comes to a slight increase of 1,3 percent in this period. Ethereum, the most valuable altcoin by market capitalization, also lags far behind Terra’s performance with a good 2.5 percent increase.

Digital Coin Price

LUNA price has now reached a new all-time high with the uptrend. Currently, the altcoin is trading at around $ 23.20, only marginally below today’s record of $ 23.84.

Cryptocurrency has seen a huge rise this year. At the beginning of the year, the price was still around 0.6 dollars. This means altcoin investors who have already invested at that time can look forward to an incredible return of 3,900 percent in less than eight months. Even a relatively small investment of 1,000 euros would bring a profit of 38,000 dollars today. But what is Terra (LUNA) anyway?

What makes the Altcoin special?

Terra is a blockchain where users can create and transfer stablecoins. In the case of Terra, the stablecoins represent fiat currencies at a ratio of 1 to 1. They also support the creation of decentralized applications( dApps) on their platform, with the most popular being CHAI, one of the most used dApps in the crypto world.

Terra was developed in 2018 by a Korean company called Terraform Labs, founded by Daniel Shin and Do Kwon. The platform launched in 2019 and the first stablecoin created was the KRT stablecoin, which is pegged to the Korean won.

Coin Price Forecast

Terra is trying to solve the volatility problem that plagues many cryptocurrencies in the market. Since the prices of crypto can change dramatically in a short time, it is difficult to use them in the real world.

While the stablecoin idea is not new, the unique thing about Terra Stablecoins is that other platforms require either fiat or cryptocurrencies as collateral, while Terra only destroys LUNA tokens and allows the system to self-regulate the price.

How does Terra work?

The Terra blockchain was built on the Cosmos blockchain. They use a proof-of-stake (PoS) mechanism, which means token holders can vote on who they want on the network as validators.

Delegators are holders of LUNA tokens on the Terra network. LUNA token holders vote for validators participating in the network’s consensus process. There can be a maximum of 100 validators.

The task of a validator is to set up a complete node and validate transaction blocks on the network. They are selected depending on the number of LUNA tokens used. Validators set their own tokens, as well as tokens entrusted to them by delegators.

If a validator does not perform its tasks correctly, its tokens are destroyed. This means that the tokens entrusted to you by the delegators will also be cut. In this way, delegators play an important role in the system, in addition to validators, because they have to pay attention to who they entrust their tokens to.

Minting stablecoins on the Terra network requires users to burn LUNA tokens worth the same amount of bound fiat currency for that coin. So, if the LUNA token is worth $ 5, you can mint 5 UST. The same principle applies if you want to burn stablecoins to get LUNA in return. This system ensures that the stablecoins always maintain the bond to their fiat currency.

If a user decides to mint some stablecoins, a small amount of the LUNA tokens they provide will not be burned, but will instead be moved to the Terra community treasury. LUNA holders are the ones who decide how these tokens are issued, and they can vote on how to change some specifications on the network.

Terra also has a Mirror protocol. This protocol allows for the minting of tokens representing real assets and stocks. These tokens are called mirror assets (mAssets). To mint mAssets, 150 percent of the MASSET value must be deposited in either Terra stablecoins or other Masset coins.

Can the LUNA price continue to rise?

With the current rally, the LUNA price has even already cracked the maximum prices from May 2021. This distinguishes the altcoin from most other cryptocurrencies, which have not yet reached their price level after the sharp correction in the second half of May.

According to experts, several reasons are responsible for the recent increase. On the one hand, the LUNA community is growing rapidly and there are many new users every day. In addition to the special feature of the Stablecoin integration, the network also shines with fast transaction times and very low fees for users.

Due to the overall very positive fundamentals of the still young project, analysts attest the LUNA course a rosy future.

For example, the market observers of Coin Price Forecast expect that the currently reached almost 24 dollars is far from over. Already for 2022, they expect a further price increase of about 50 percent to a price level of 35 dollars. Already in 2023, the 50 dollar mark could be cracked and the purchase of LUNA could bring a return of more than 100 percent at the present time. The analysts expect continued price increases in the following years as well. By 2033, Coin Price Forecast even considers a price of more than $ 100 per LUNA token possible.

Digital Coin Price

Wallet Investor’s forecasts are similarly bullish. A further increase of more than 43 percent is expected by 2022. By 2023, it could even be around 97 percent value growth for investors. In the long term, the analysts even believe that a price increase of more than 250 percent by 2026 is feasible.

The expectation of Digital Coin Price is somewhat more restrained but still bullish overall. For example, only moderate growth at a level below $ 30 is expected in 2023. In the next few years, the experts see the price then in regions between 50 and 85 dollars.