Following the introduction of a 1.2% burn tax on all swaps, the value of Terra’s Luna Classic has significantly increased during the previous week.
The coin reached a weekly high of $0.00031131 before regaining some of its gains.
Despite this, LUNC is among the best-performing cryptocurrencies during the current bad market. In the previous four months, the value of the asset has increased by more than 250,000% from its historical collapse in May.
LUNC has increased 160.5% in the previous 30 days and over 200% in the last 14 days.
The excitement about the combination has not prevented Bitcoin and Ethereum from losing almost 13% and 4% of their respective values over the last 30 days.
After the Terra system failed, the initial LUNA token’s volume increased to 7 trillion. The token’s value subsequently dropped from over $80 to less than a penny due to inflation.
Since then, blockchain governance has been transferred to the community, which is currently attempting to redeem the coin.
The previous burn rate removed nearly 3 billion tokens from use before the new 1.2% process.
The token’s value has also recovered because of Terra’s staking system. On August 27, the staking ratio was 2.6% of the entire supply. Now, though, it has reached 7.5%.
The 37% APY wagering payouts are the primary element luring more bettors. However, these enormous returns resemble the unsustainable yields that precipitated the demise of the original ecosystem.
Nonetheless, many are excited about the September 12 launch of the new burn mechanism. It will work with on-chain swaps and popular cryptocurrency markets like Binance and KuCoin.
Depending on trade volume, if the burn mechanism is activated, it might result in the consumption of over half of the supply within a few months. However, there are other elements that will affect the effectiveness of the burn process.
Also Read: FBI Warns Investors About DeFi Hacks