The rebirth of Terraform Labs’ ecosystem and cryptocurrency has not quite gone to plan and there could be more pain ahead for recipients of the LUNA airdrop that plan to hold.
Terra rebooted its network on May 27 with a brand new genesis blockchain and LUNA token. Over the weekend, holders of the old UST and LUNA (Classic) tokens were airdropped the new LUNA token, but there was little reason to celebrate.
As reported by BeInCrypto, LUNA 2 has crashed heavily since the airdrops began. The token debuted and hit a peak price of just under $19 before dumping 78% to a low of $4.08 on May 28. It has recovered slightly to trade at just over $6 during the Monday morning Asian trading session but overall, the token has been smashed around 70% in just a couple of days.
The only winners appear to be the centralized exchanges profiting from trading fees as the sell-off accelerated. One of those exchanges, Binance, may have a greater influence on short-term LUNA prices as it prepares its own airdrop.
More pain from Binance
The world’s largest exchange has yet to initiate its airdrop to LUNA and UST Classic holders, but when it does, the sell-off could accelerate according to Terra researcher ‘Terra Watcher.’
Binance will begin its multi-year airdrop on Tuesday, May 31 according to an announcement over the weekend. It will also list Terra 2.0 in its ‘Innovation Zone,’ a dedicated trading area new high risk and high volatility tokens can be traded.
The researcher said that Binance can move markets because it has 15.7 million in liquid LUNA which will be available to users on Tuesday. He added that Binance users are likely to dump the tokens because the exchange offered staking through the Anchor Protocol.
“Many users had UST on Anchor via Binance at pre-attack snapshot. Many of these users never owned old LUNA and don’t care about new LUNA. Yeah, they’re gonna dump.”
Crypto influencer Lark Davis confirmed that he would be one of those dumping any LUNA 2 he gets from Binance to recoup some of those losses.
Terra torment continues
The big flop in prices since the airdrops began a couple of days ago has resulted in a flurry of memes, jokes, and general mockery on crypto Twitter.
Very few were pleased with the outcome, having lost thousands of dollars only to get airdropped a tiny percentage of that loss in new tokens that have already been dumped by most recipients.
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