LUNC, the token associated with the original Terra Luna Classic chain, experienced a significant rally, increasing by over 49% leading up to the weekend. The token reached a one-month high, fueled by anticipation that the Terra brand might re-emerge with a new value proposition.
LUNC emerged as an alternative token following the collapse of Terra (LUNA). The original project bifurcated into Terra 2.0, which introduced its own LUNA token, while a segment of the community migrated to LUNC.
Both LUNC and LUNA are currently vying for a potential comeback. LUNC climbed to $0.000040, while LUNA also traded at a one-month high of $0.09. Both assets indicate a possibility of the Terra brand's revival, and both have seen near-vertical rallies in the preceding 24 hours.
LUNC briefly surpassed LUNA in terms of growth, as LUNA is also actively attempting to revitalize the brand.
Why Did LUNC Rise Suddenly?
LUNC's sudden surge was attributed to increased exposure. During Binance Blockchain Week, a moderator was observed wearing an old Luna T-shirt, drawing attention to the previously prominent project.
Despite the Terra ecosystem's crash, the brand persisted, along with its native token. The resilience of crypto assets has allowed LUNC and LUNA to remain relevant, evolving into meme tokens and fostering communities that have proposed relaunching the protocol with enhanced risk management strategies.
The uptick in LUNC and LUNA also coincided with a minor rally in FTT, the native token of the now-bankrupt FTX exchange.
LUNC demonstrated that it is not a defunct asset, trading at its highest volume level since January. Daily trading volume surged by 10 times, reaching $128 million in the past 24 hours, a significant increase from its baseline level of approximately $10 million. Visitors to the Terra Classic website also saw an increase in the past day, following the token's rally.
LUNC's price movement was also influenced by its concentrated trading activity with a highly active legacy pair on Binance. The asset has not been delisted, and this trading pair could effectively absorb the hype-driven trading volume.
The token has yet to prove whether this rally is sustainable and if the Terra Classic chain can offer tangible value. Currently, the chain has limited Decentralized Finance (DeFi) value, standing below $1 million, although users are actively working to revive TerraSwap, its primary decentralized exchange (DEX).
Is the LUNC Rally Sustainable?
Shortly after reaching its one-month high, LUNC experienced a downturn. The token remains relatively illiquid and largely unknown outside of its dedicated community. LUNC has experienced similar rallies in the past, primarily driven by community enthusiasm. This recent surge saw LUNC increase its mindshare by 193% in the past day, although this metric is based on a very limited social media presence.
The Terra Classic chain is undergoing preparations for an upgrade intended to position it as a competitor in the DeFi space. However, it is anticipated that rebuilding the chain's liquidity may take a considerable amount of time.
Further attention may be directed towards LUNC and LUNA as the sentencing of Terra's founder, Do Kwon, is expected on December 11. While this event could potentially amplify the hype, Kwon will have no further connection to the project.
Prediction markets are actively engaged with this development, with the majority of traders anticipating a sentencing of 9 to 12 years.