Terra Luna Classic price remains under pressure this year even as the token burn momentum gains steam. The LUNC token was trading at $0.00007615 on Friday morning, down by 60% from its highest level in 2024 and 75% from its all-time high. So, is the Terra Classic a good token to buy and hold?
Terra Luna Classic price crashes amid token burns
The LUNC price has plunged in the past few months even as the network continued to burn billions of tokens. According to LUNC Metrics, the network has incinerated 314,131,759 tokens in the last seven days.
This burn has brought the cumulative token burns to over 403 billion, leaving the circulating supply to 6.5 trillion tokens.
Binance, the biggest player in the crypto exchange industry, has led the charge of these burns, incinerating over 70 billion tokens. DFLUNC Protocol has incinerated over 4.5 billion tokens, while LunaticsToken has burned over 1.9 billion coins.These tokens will continue growing in the next few years.
A token burn is a situation where a cryptocurrency is dumped into an inaccessible address. It helps to boost a token value by making the remaining ones scarce and boosting their prices.
Why LUNC has crashed
There are two main reasons why the Terra Luna Classic price has crashed as the token burn has accelerated. First, LUNC price has plunged because of the relatively weak demand for the coin.
Many crypto investors are afraid of being associated with Terra Luna Classic because of its sad history. For starters, Terra was once one of the biggest players in the crypto industry with a market cap of over $45 billion in assets.
Most of these assets were linked to UST, a stablecoin that gave users double-digit returns algorithmically. Terra collapsed when the stablecoin lost its peg in 2022. After that, the community took over the Terra Luna Classic coin and aimed to create a viable ecosystem from it. Do Kwon and his team went ahead and created Terra 2.0.
Therefore, while LUNC is controlled by the community, many users are often afraid of associating with it.
Second, LUNC token has plunged because of the ongoing weakness in the crypto industry. Bitcoin price has crashed from $109,200 to $95,000. Most coins, including Ethereum, Solana, and Cardano have all plunged this year. Historically, cryptocurrencies often move in sync with each other.
Third, the Terra Luna Classic price has dived because of the lack of an ecosystem in the network. When the community took over, they pledged to build applications on top of it, which has not happened yet. The multiple Terra Classic upgrades have not helped.
LUNC price forecast
The weekly chart shows that the LUNC price has been under pressure after peaking at $0.00076 in 2022. It has now plunged below $0.00010, and is at a crucial support level since it has failed to move below it several times since 2023.
LUNC price has crashed below all moving averages, a sign that bears are in control. It is now at a decisive level since a crash or a surge can happen here.
The horizontal line at $0.000054 can be seen as a quadruple bottom, a popular bullish catalyst. In most periods, such a level is usually a highly bullish in technical analysis, and is a sign that it may soon surge to the resistance level at $0.0001792.
On the other hand, that price maybe the lower side of the descending triangle pattern, a popular bearish sign. A move below the horizontal line will point to more downside in the near term.
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