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About Terra Classic
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What is Terra Classic (LUNC)?
: A blockchain protocol using fiat-pegged stablecoins for price-stable global payments systems. -
Development began
: January 2018, mainnet launched in April 2019. -
Stablecoins
: Pegged to USD, KRW, MNT, and IMF’s SDR basket of currencies. -
Rename
: Original Terra Chain rebranded as Terra Classic, native token LUNA renamed LUNA Classic (LUNC).
What is Luna Classic (LUNC)?
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Native
About Terra Classic: A Beacon of Stability in the Cryptosphere
Introducing Terra Classic (LUNC): A Comprehensive Overview
Terra is a blockchain protocol that leverages fiat-pegged stablecoins to facilitate seamless, price-stable global payment systems. As outlined in its white paper, Terra synergistically combines the stability and widespread adoption of fiat currencies with the decentralized, censorship-resistant attributes of Bitcoin (BTC), while providing rapid and cost-effective settlement solutions.
Development on Terra commenced in January 2018, with its mainnet officially debuting in April 2019. As of September 2021, the platform boasts a diverse array of stablecoins, including those pegged to the U.S. dollar, South Korean won, Mongolian tugrik, and the International Monetary Fund’s Special Drawing Rights basket of currencies — with plans to introduce additional options in the future.
On May 28, 2022, the inaugural genesis block of the novel chain was launched, thereby facilitating future transactions under the auspices of Terra (LUNA), while the original Terra Chain underwent a rebranding to Terra Classic. Concurrently, the native token, formerly known as LUNA, was rechristened as LUNA Classic (LUNC). Furthermore, all network stablecoins, comprising UST, KRT, and EUT, have been rebranded as Terra Classic stablecoins, denoted as USTC, KRTC, and EUTC, respectively. Notably, the new chain will not support Terra stablecoins.
A prevailing theory suggests that the appended term “classic” is an allusion to the 2017 schism between Ethereum and Ethereum Classic. According to CEO Do Kwon, the catastrophic collapse of UST in the spring of 2022 is analogous to the infamous DAO hack that befell Ethereum in 2017.
Introducing Luna Classic (LUNC): A Comprehensive Overview
Luna Classic (LUNC) is the pioneering native token of the Terra blockchain, initially released in August 2018. Notably, $LUNC predates the launch of the new chain, now rebranded as Terra (LUNA), and operates in tandem with the original codebase of the Terra ecosystem.
The native token’s primary function was to mitigate the price volatility of the algorithmic stablecoin, UST. The UST stablecoin’s value was pegged to the US dollar through the dynamic minting and burning of UST tokens, which balanced the supply and demand of the coin. However, in May 2022, UST catastrophically lost its peg and subsequently collapsed. The UST stablecoin algorithm’s malfunction triggered an uncontrollable surge in LUNA token creation, plunging into a hyperinflationary vortex that devastatingly eroded the value of the original LUNA token by a staggering 99%.
Delve into the comprehensive analysis of the Terra Crash
The distinction between Terra (LUNA) and Terra Classic (LUNC) lies at the heart of a fascinating narrative in the realm of cryptocurrency. While both entities share a common heritage, they have since diverged, each forging its own unique path.
Consequently, both versions of the token coexist as a direct result of the implementation of the Terra Ecosystem Revival Plan 2. The plan’s underlying principle involves forking the current blockchain, thereby creating a new chain within the ecosystem while preserving the original version.
Pursuant to the recovery plan, the existing chain and token have undergone a rebranding, emerging as Terra Classic. Meanwhile, new LUNA tokens were airdropped to existing holders of LUNA and UST, preceding the depeg and subsequent crash.
The Visionaries Behind Terra Classic: Unveiling the Founders
In January 2018, Daniel Shin and Do Kwon co-founded Terra, a pioneering project conceived to accelerate the widespread adoption of blockchain technology and cryptocurrency. By prioritizing price stability and usability, the duo aimed to bridge the gap between the nascent industry and mainstream acceptance. As the CEO of Terraform Labs, the entity driving Terra’s vision, Kwon spearheaded the endeavour.
Prior to conceiving Terra, Shin co-founded and helmed Ticket Monster, also known as TMON, a prominent South Korean e-commerce platform. He subsequently co-founded Fast Track Asia, a startup incubator that collaborates with entrepreneurs to nurture fully fledged companies.
Prior to his current endeavors, Kwon founded and helmed Anyfi, a pioneering startup that specializes in decentralized wireless mesh networking solutions. His impressive resume also boasts stints as a software engineer at tech giants Microsoft and Apple.
Unveiling the Uniqueness of Terra Classic
Terra distinguishes itself through its innovative deployment of fiat-pegged stablecoins, effectively merging the boundless advantages of cryptocurrencies with the everyday price stability of traditional fiat currencies. The platform maintains a precise one-to-one parity through a sophisticated algorithm that dynamically adjusts the stablecoin supply in response to fluctuating demand. This is achieved by incentivizing LUNA holders to engage in profitable exchanges of LUNA and stablecoins, as needed, thereby expanding or contracting the stablecoin supply to precisely match prevailing demand.
Terra has forged a multitude of strategic partnerships with prominent payments platforms, with a particular focus on the Asia-Pacific region. Notably, in July 2019, Terra announced a landmark collaboration with Chai, a leading South Korea-based mobile payments application. This partnership enables seamless transactions on e-commerce platforms, which are subsequently processed via the Terra blockchain network. Each transaction is subject to a nominal fee of approximately 2%–3%, borne by the merchant.
Furthermore, Terra benefits from the backing of the Terra Alliance, a consortium of businesses and platforms dedicated to promoting the widespread adoption of Terra. Notably, in February 2019, the company revealed that e-commerce platforms from 10 distinct countries, collectively representing a substantial user base of 45 million and a gross merchandise value of $25 billion, had joined the alliance.
The Circulating Supply of Terra Classic (LUNC) Coins: An Overview
As of August 2022, the total supply of Terra Classic (LUNC) stands at a staggering 6.9 trillion, with a circulating supply of 6.5 trillion LUNC.
The Terra Network’s Security Mechanisms: A Robust Framework
The Terra blockchain is fortified by a proof-of-stake consensus algorithm, built upon Tendermint, wherein LUNA token holders pledge their tokens as collateral to validate transactions, earning rewards commensurate with the amount of LUNA staked. Furthermore, tokenholders have the option to delegate validation duties to others, sharing in the revenue generated. Additionally, Terra provides validator nodes with supplementary guidance on optimal practices to ensure the network’s security.
In May 2019, shortly after Terra’s mainnet went live, CertiK, a renowned blockchain verification and penetration testing firm, conducted a comprehensive security audit of the network. The audit encompassed a thorough examination of Terra’s economic model, with a focus on its resilience to market manipulation, as well as a meticulous review of its architecture and coding language. The findings of the audit revealed that the “modeling and mathematical reasoning” underlying the Terra network were deemed “sound and robust,” although CertiK opted not to comment on the blockchain’s performance.
Where to Acquire Terra Classic (LUNC): A Comprehensive Guide
The majority of prominent cryptocurrency exchanges have historically supported Terra Luna, and they continue to do so with Terra Classic (LUNC) to this day. Notably, Luna Classic is presently listed on esteemed platforms, including Binance, KuCoin, Kraken, Huobi Global, PancakeSwap (V2), MEXC, and Gate.io.
Stay up-to-date with LUNC’s market performance in real-time by downloading the CMC mobile app.
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The Pivotal Role of Terra Classic in the UST Ecosystem
The LUNA token and UST are inextricably linked, with the prosperity of the Terra ecosystem contingent upon the widespread adoption of UST as a stablecoin. LUNA serves as collateral for UST, and its supply is reduced when demand for the stablecoin surges. Notably, following upgrades such as Columbus-5, the LUNA supply is poised to become increasingly deflationary in the long term.
On the flip side, the value of LUNA is also susceptible to decline if UST’s stability is called into question. A notable example is the temporary price plummet of LUNA that ensued when UST briefly lost its peg in the aftermath of the Wormhole hack.
In May 2022, a cascade of liquidations and bank runs ensued as investors hastily withdrew their funds, causing UST Classic to drastically depeg to a nadir of $0.044. Concurrently, LUNA Classic plummeted by a staggering 99% from its previous high of over $80, never to recover. The peg of UST Classic remained irreparably broken.
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