Luna Classic continues to garner support within the crypto community as many aim for a price surge. However, chances of this appear unlikely as several catalysts to the price surge are absent from the ecosystem. LUNC price stands at $0.00007538 far below bullish projections.
Several Luna Classic holders have projected massive milestones for the asset in recent months. However, the road ahead looks dark because of the asset sentiments and supply factors.
Persisting Fear
The major reason why LUNC records slower growth than projected is due to the prevailing sentiment around the asset. Although the Terra ecosystem imploded two years ago, the widespread effects of the collapse are still echoed in the market. This has led to a slow inflow of the asset against the projected buzz.
The platform’s algorithmic stablecoin lost its peg with the dollar leading to huge losses. Subsequently, the price crash led to investigations and an arrest warrant issued for founder Do Kwon. Luna which rebranded to Luna Classic has struggled to build traction.
Tokenomics
While the project’s bulls have backed the present state of the ecosystem, several have faulted the token supply. The total supply of LUNC is 6,794,537,545,225 tokens while its circulating supply stands at 5,710,709,456,179 tokens. This is a huge number of assets within the ecosystem sparking calls for an increased burn rate. High burn rates are used to reduce token supply which in turn adds to the price of the asset. In a nutshell, scarce tokens will lead to an increased price and billions of assets, and more leads to slow growth.
Crypto Market Sentiment
The crypto market has shed significant value in the past weeks due to plunging market sentiment and Bitcoin price falling below $55,000. As a result, the price of assets tanked wiping off gains recorded in Q1 2024. Luna Classic needs positive sentiments to attract the needed inflows. An uphill drive for the asset is also dependent on macroeconomic factors like a cut in interest rates among others. The Bank of Canada announced rate cuts leading to speculations in the United States.
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