Almost all investors today are looking for the best investment opportunities to gain returns over the long run. As a result, there are several developing innovative blockchain projects in the market today. Terra (LUNA) has positioned itself as a potential cryptocurrency poised for growth with an experienced development team, a clear whitepaper, several big supporters, and a tremendous rally. Moreover, crypto experts suggest that Terra could be a millionaire-maker coin for investors.
Terra has been gaining massive popularity since the end of June 2021. LUNA has been a lucrative investment for investors, with a return of almost 1,490.47%. But, despite its stellar returns and price rise, there are several other reasons why Terra is one of the top cryptocurrencies to buy now. So let’s look at why this intriguing coin is a good buy now.
Terra (LUNA): What Is It?
LUNA has performed incredibly well this year and might continue to rise higher with increased adoption and developments in the network.
Terra Luna is known as the world’s biggest dual-token platform. That is, it is a network with two intertwined tokens with its own separate utility. LUNA coins exist on the native blockchain, while TerraUSD stablecoins are on the Ethereum blockchain. This unique mechanism solves one of the greatest issues that cryptocurrencies like Bitcoin face - volatility.
Each TerraUSD coin is pegged to the US dollar on a ratio of 1:1 and allows users to conduct everyday transactions without the fear of sudden fluctuations. Terra stands apart from other cryptocurrencies with its fiat-pegged stablecoins that combine the borderless benefits of cryptocurrencies with the everyday price stability of fiat currencies.
Therefore, as a company, Terra is a fully digital, decentralized financial institution with its own kind of central reserve. Moreover, its customers can earn internet on their assets, spend them through its payment system or even invest in synthetic stocks.
LUNA Price History
LUNA has seen meteoric growth since the end of June 2021. The past few weeks have been a fantastic time for the governance token with Coinbase's listing of TerraUSD and several other network upgrades. With a significant rally, LUNA has hit an all-time high of $34.25 on August 24. Moreover, LUNA’s prices have risen over 2,000% from January to October 2021. In the last month of 2021, Terra reached its current all-time high of $103.33.
Is Terra A Millionaire Maker Investment?
Thanks to the colossal growth of the DeFi market, Terra is one of the fastest-growing cryptocurrencies to buy now.
The Terra cryptocurrency is known for its development-focused agenda. The network offers programmers multiple opportunities. It allows them to build smart contracts in Rust, GO, or Assembly Script. Additionally, by leveraging the network's oracles, users can also add extra functionalities to their dApp.
The team behind Terra was focused on building a transparent ecosystem. Also, in order to replace the complicated payments value chain, the network was built from scratch. Therefore, Terra helps in completely removing the need for credit card networks, banks, and payment gateways with a single blockchain layer.
Yet another factor that could make Terra a millionaire-maker coin is its role in the DeFi (decentralized finance) sector. Terra is rapidly becoming a front-runner in the lucrative DeFi market, with over $6.1 billion pledged for the project’s protocols. This includes the Mirror protocol that facilitates developers in creating fungible assets for trading on its blockchain. In addition, the Anchor protocol incentivizes investors to lend out their TerraUSD for interest rates as high as 20%.
Thanks to the project’s successful developments, the price of LUNA has risen significantly, making it a good buy now. In addition, the network already has millions of users and has established numerous partnerships with payment platforms, especially in the Asia-Pacific region.
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Factors That Could Make Terra A Millionaire Maker
From significant partnerships to various upgrades, several factors make LUNA an excellent long-term investment option for investors.
1. Popularity In South Korea
Terra has gained massive popularity and success in its native, South Korea. A video released by the team in May 2021 shows that Terra’s stablecoin, pegged to the South Korean WON, is used by over 2 million people per year for over 41 billion in spending. Therefore, the considerable customer base in Korea will drive LUNA’s adoption rate, which will eventually push its value higher.
2. Terra’s Partnership With Harmony
A key reason for the bullish trend in LUNA’s price is Terra’s latest one-stack partnership with Harmony (ONE). Both platforms have unanimously collided to explore their DeFi initiatives together. Terra will integrate Harmony on its Shuttle Bridge platform. This will allow users to send UST across all supported blockchains. Moreover, by exploring its DeFi capabilities, the platform would experience an increased adoption rate and eventually skyrocket LUNA to significant highs. This partnership also exposes the growing demand for reliable and secure stablecoins that can operate across multiple blockchain networks.
Do Kwon, co-founder and CEO of Terra, said, “Terra is excited to expand our growing portfolio of DeFi products to multiple chains and work with Harmony to bring UST and Anchor to another growing ecosystem.
3. Significance Of LUNA Tokens
LUNA, the native governance token of the Terra network, plays a significant role in powering the blockchain network. Therefore, it is fundamental to keep Terra’s stablecoins steady, and also token holders can stake the coin to gain rewards for absorbing the volatility.
By using their LUNA coins, investors can seamlessly maintain the target 1:1 exchange rate of TerraUSD to US dollars. It employs a unique algorithm that automatically adjusts stablecoin supply based on its demand to maintain the one-to-one peg. This is done by incentivizing LUNA holders to swap LUNA and stablecoins at a required profitable exchange rate to either expand or limit the stablecoin supply to match demand.
Precisely, LUNA coins work as the collateral for TerraUSD. For instance, during excessive demand, investors can swap or buy LUNA for Terra USD at an inflated price by banking in the difference, increasing the latter's supply, and driving the price down and back to par. On the other hand, by banking on the difference, decreasing the supply, and driving the price up and back to par, investors can also sell or swap TerraUSD for LUNA at a highly discounted price when the demand is plunging.
4. The Launch Of Columbus 5
A significant reason to buy LUNA now is the upcoming launch of its much-anticipated Columbus-5 network upgrade. It will go live with three key protocol updates. The upgrade will also accelerate the burning of LUNA tokens, removing them from the supply forever.
The network has already burned more than $185 million worth of LUNA in August 2021. This will significantly reduce the supply, pushing LUNA’s value and demand higher in the future.
Furthermore, the upgrade will provide insurance for projects built by Terraform Labs. Finally, the Columbus -5 update will also commission inter-chain communication between Terra and Solana, Cosmos, and Polkadot, further improving its network capabilities and driving LUNA’s adoption.
5. Support From Terraform Labs
The major reason behind the significant price rise of LUNA recently is the support from the company behind the Terra blockchain, Terraform Labs. The company, on July 7, decided to use 50 million Terra SDT (SDT) worth roughly 70 million UST from the TFL stability reserve fund to capitalize the yield reserve for Anchor protocol. This way, the role of stablecoins in the cryptocurrency ecosystem has tremendously increased, resulting in a boost of both price and demand of LUNA.
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Can LUNA Be A Millionaire Maker Coin?
This could be the best time to buy LUNA as it has successfully positioned itself on the list of the biggest gainers in 2021.
Terra’s decentralized and permissionless nature makes it an ideal token for the digital economy. It offers competitive programmable payments and logistics. The network also provides an infrastructure designed to simplify Dapp and stablecoin development. However, given its recent performance, Terra seems to be a good investment option for investors.
Terra not only generates wealth for investors, but it's stablecoins can also help them manage stability in consumer transactions. Overall, Terra is a promising and innovative cryptocurrency that could be a millionaire-maker coin for investors in the coming decades.
LUNA has performed tremendously this year. However, the rising interest in integrating with the Terra ecosystem exposes the growing significance of stablecoins and their role in the broader cryptocurrency ecosystem. Furthermore, the trend will continue to grow even stronger as new participants enter the crypto space. Therefore, with all its capabilities and increasing adoption rate Terra could be a millionaire-maker coin for investors.
However, all cryptocurrencies are risky. So ensure that you have a good understanding of how the stablecoin environment might unfold before you invest.