Behind the infamous collapse of the Luna last year, the Luna Classic (LUNC) ecosystem, a remnant of the original Terra blockchain, is poised for a potential revival. A dedicated team of six engineers has taken up the mantle to breathe new life into this once-thriving ecosystem
The engineers, jointly led by individuals known as “Bilbo Baggins” and “Solid Snake,” have proposed a governance plan that entails a three-month expenditure of $116,000 from the Terra Classic community. They assert that if the proposal is accepted, they will dedicate part-time efforts toward the project’s rejuvenation.
Samurai Six said, “LUNC has limitless upside potential, and we want to help realize it by leveraging our skills to bring value to the blockchain and all its investors in order to accomplish a true revival of the ecosystem.”
Considering the existing supply, a $1 price for LUNC would result in a Luna Classic market cap of $5.9 trillion. Given that the total crypto market cap peaked at $3 trillion, it’s reasonable to conclude that a $1 LUNC is not a feasible expectation unless there’s a significant reduction in the LUNC’s supply.
The Terra Classic community is relying on the new burn tax on the token to decrease the LUNC supply. The token supply, which was approximately 343 million on May 4, inflated to over 6.5 trillion by May 14.
At present, the Terra Classic blockchain imposes a 0.2% tax on all LUNC token transactions, aimed at gradually reducing the LUNC token supply. Initially, this tax was set at 1.2%, but it excessively deterred on-chain activity, leading to a more than 90% drop in on-chain transaction volume.
From a certain viewpoint, LUNC has already rebounded. The coin boasts a market capitalization of over $500 million, even though the chain’s DeFi ecosystem had a Total Value Locked (TVL) of only about $2.4 million as of 27 June 2023. The platform also appears to have relatively low adoption in terms of decentralized applications. Therefore, it’s difficult to claim that LUNC is currently undervalued.