Cryptocurrency has been an eye-catching investment model. Since its launch, the token has made way for various investors to try their luck with cryptos. Cryptos have created a huge market space for themselves making them a popular investment. The market capitalization of cryptos now consumes more than $3 trillion. Since these currencies do not take any physical shape the market has also expanded globally.
Daily, there are transactions undertaken on a huge scale. The prices keep fluctuating every day making it difficult for investment experts to predict. The market crash in 2022 and the continuing bearish market is an example of it. Given the performance of cryptos in 2021, the market crash in the current year became a huge blow to many investors. Before trading Bitcoins, make sure you are trading with a reputable platform to know why bitcoin is safer than cash.
Many investors have almost lost all their savings through the market crash in 2022. Popular names in the market including Bitcoin saw heavy losses. The price of tokens came down to an all-time low at $15k per token. An interesting factor here is that Bitcoin traded at $65k per token in 2021.
One such crypto token that faced a huge backlash during a market crash is the Terra Luna.
Understanding Terra Luna
Terra is nothing but an open-source blockchain platform. It hosts an ecosystem that allows users to develop and work on various decentralized apps. Along with various developer tools, the platform enables easier transactions and development. Terra is one of the finest and fastest-growing blockchain platforms. It offers an unparalleled experience when it comes to working on decentralized finance. Also, the platform works on the proof of stake philosophy making transactions easier. Since the blockchain is open source, developers can make changes in the coding. It also helps users to develop next-generation products that are accessible and easy to use. The product is made accessible to anyone with stable internet connectivity.
Luna is the native token developed in the Terra platform. The Luna token is typically used for mining and the purpose of governance. Data validators who act on the platform can use Luna for staking. Using this protocol, allows users to record and verify each user transaction. Additionally, users also earn rewards and reduced charges on each transaction.
How did Terra crash in the market in 2022?
If you have been following crypto investments, then you might be well aware of the market crash in 2022. Terra faced the heaviest market crash during this period. It would not be wrong to assume that the token was completely wiped out from the global investment market.
Until May 2022, the token was considered a worthwhile holding providing growth opportunities. But the market performance on two consecutive days flipped this ideology. On May 11, the token was priced at $120 per token. In less than 24 hours, the price of the token reduced to $0.02 creating a correction in rates at 99.9%. Subsequently, in the following days, the prices of tokens fell further reducing LUNA to the lowest. Considering the downward trend, many crypto exchanges went ahead to delist this token. From May until early September there was not much news about how Terra planned to survive.
But keeping aside all expectations, the prices of Terra skyrocketed by more than 200%. Yes, you heard it right. Many investors were surprised by this move and the market performance of Terra.
Terra developers distributed their blockchains into two units. The Terra Classic and Luna 2.0.
Terra Classic is the original version of their blockchain with a new name. This is the brain game of Terra’s developer. Through this regeneration strategy, developers will airdrop Terra Luna tokens to investors. The blockchain has been identified by investors who were impacted by this market crash. Also, the Luna Classic passed a governance module enabling the addition of a 1.2% tax on all transactions on the chain.
In the current situation, it would not be wrong to assume Terra is making its entry slowly into the market. The prices are increasing and it may take a while to reach their pre-market price. Yet, there is still hope for recovery on this investment token. Terra has once again been able to take the name as promising crypto for investment.