Why Luna Classic (LUNC) Price Is Soaring?

Breaking its downward trend, Terra Luna Classic (LUNC) attracted major bids at about $0.000226. The last several weeks’ coin performance has been dismal prior to the new governance proposal for re-enabling IBC.

The coin’s unexpected rally could be attributed to the ongoing Governance Proposal 10880. It’s about unfreezing & updating the IBC Tendermint client 07-tendermint-71, which references the Cosmoshub. 

But What Is IBC & Why Is It Important?

It’s important to note that the IBC protocol facilitates communication and value transfer between separate Cosmos chains. When the ecosystem collapsed in May, the Terra Classic network, which was initially a Cosmos chain, had the channels permanently stopped to prevent temporary losses.

Re-enabling IBC has become vital to access stalled liquidity and increase the chain’s utility as the network now maps a course for recovery. As revealed by core developer Edward Kim in September, the Terra Rebels, a separate group of volunteers working on the Terra Classic chain, contacted Gadikian for this purpose. Notably, Gadikian offered to clean up the chain in addition to helping them with the challenging work of re-enabling IBC after it had been permanently disabled.

Proposal #10880 will pass quorum soon.
Reactivating IBC’s brings interoperability meaning that funds on other chains can be used to generate yield from liquidity pools.https://t.co/CGYqVUXnc3 pic.twitter.com/Pp9dvr96xq

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— Knowledge (@SkoobyDol) November 5, 2022

Proposal 5234 & Other Rumors

Apart from the proposal of re-enabling IBC, Proposal 5234, reduced the burning tax from 1.2% to 0.2% and made the Terra Classic one of the industry’s most hyped-up topics. And due to this proposal, billions of LUNC tokens will get removed from circulation, thus increasing demand and helping the token rally in price.

The LUNA Classic’s gains were further fuelled by reports that the project would be listed on Coinbase on Monday. Although, the authenticity of this rumor is yet to be ascertained.

At the time of composing, LUNC holds strong at $0.00025 with a $600 24-hour trading volume. In the past 24 hours, Terra Classic has increased by over 11 %. With a live market cap of $1.6 billion, the current market ranking is #38.

The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.