Terra Classic (LUNC) has outperformed all top-rated cryptocurrencies in September, gaining nearly 100% in just the last seven days.
Terra Classic dominates the crypto market
The token surged more than 250% month-to-date to reach $0.000594 on September 8, its best level on record. Bitcoin (BTC) is up 4% and Ether (ETH) is up just 3.5% over the same period.
Despite being linked to the defunct Terra (LUNA) token from the $40 billion project that collapsed in May, gains in the Terra Classic market were seen. Terra Classic is a rebrand of the same Terra project and has been met with skepticism by analysts and investors since its inception.
However, traders have ignored such warnings in recent weeks, with several fundamental reasons influencing them to buy lunch.
Stacking service
A A new stacking service is live On August 27 on the Terra Classic chain, it will serve as the first major signal behind the ongoing LUNC price rally.
According to LuncStaking_Bot, users have shared more than 610 billion LUNC with Terra Classic against a net supply of 6.9 trillion units. In other words, nearly 9% of the total LUNC supply has been removed from circulation.
Supply and stock of LUNC
Supply
Total: 6,903,660,538,201stockade
Bound: 533,102,702,962
Unaffiliated: 77,003,374,763STACKING RATIO
8.837% (bound: 7.722%)2022-09-08 17:30 UTC#Away
– LUNC staking (@LuncStaking_Bot) September 8, 2022
According to data from StakingRewards, Terra Classic staking is returning users with an annual yield of 37.8%, the highest payout in the crypto industry.
High earnings could have played a key role in increasing demand for LUNC, which, as shown in the chart below, caused the token’s price to increase by more than 450% after the launch of the stock service.
Burn the LUNC token
In addition to staking, the developers of Terra Classic introduced a token burning method to increase the scarcity of LUNCs.
Terra Classic community member Edward Kim proposed a 1.2% sales tax on the chain at LUNC in early September. Proceedings from this tax will eventually reach the deceased address, thereby permanently removing the specified LUNC supply from distribution.
Terra Luna Classic (#Away) skyrocketed >37,000% since the bottom after the collapse of Terra
This comes after proposals to implement a 1.2% token burning tax on all transactions. $ away To become a discount cryptocurrency.#Away ✨ #Haile Lan ✨ $ away ✨ pic.twitter.com/oIxI7tqVkW
– Hailey LUNC ✳️ (@TheMoonHailey) September 7, 2022
Interestingly, there is a LUNC burning mechanism in place that has permanently removed over 3.6 billion tokens, according to LUNC Burner.
Big danger ahead
However, some technical indicators show that the LUNC price rally is at risk of a near-term correction. These include the daily Relative Strength Index (RSI), which crossed 90 on September 8, overbought and typically followed by a price correction.
Also, LUNC’s recent gains have been accompanied by lower volumes, suggesting traders are unconvinced about the price rally’s longevity.
The first potential sign of extinction at the top $ away pic.twitter.com/Fn11FHevnZ
— Livercoin (@Livercoin) September 8, 2022
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