- 238 million LUNA tokens have been burned.
- Due to the burn mechanism, increased demand for UST has resulted in a price increase for LUNA.
- The Columbus-5 upgrade effectively burns all of the tokens that were allocated.
The Terra network protocol has achieved a new goal of burning over 238 million LUNA tokens since the implementation of the burning mechanism, making it the greatest layer 1 token burning in crypto history.
Terra’s LUNA token has increased in value by 18500% in the last 18 months, leaving many other cryptocurrencies in the dust as this pioneering blockchain project gains traction.
The increase in token prices is mostly due to a combination of decreasing token supply and a series of changes to how the coin is utilized in its own payment network.
The total Terra LUNA token supply has declined from 1 billion to 761.36 million since the token burn began, implying that roughly 238.64 million tokens have been burnt, valued at $22.432 billion at current pricing.
Terra Analytics’ on-chain data shows that the most well-known Proof-of-Stake smart contract platform has been burning its network native token at an incredible rate, with over 120 million burned in the last year.
The network’s Columbus-5 upgrade in October 2021, which is a new architecture for keeping stablecoins fixed to their fiat value by burning LUNA with the same amount of value whenever UST is generated, was a major step forward for the LUNA ecosystem.
This has helped both the UST stablecoin and the LUNA token, which has seen an increase in demand as supply drops, resulting in a price increase, with the token profiting for eight out of the last nine months despite the growing uncertainty in the crypto market.
TerraUSD (UST), the decentralized stablecoin of the Terra LUNA network, has surpassed a market cap of $15 billion, making it the first decentralized stable cryptocurrency to do so. UST is presently among the top 15 most valuable cryptocurrencies in terms of market capitalization.
The Columbus-5 upgrade in October 2021 proposes a new token-burning mechanism with the primary purpose of making LUNA a deflationary asset. It would only be conceivable if the asset’s net issuance stayed lower than the number of coins burnt over time.
Following the implementation of the network update in October 2021, LUNA experienced a rebound in attention, demand, and price action due to its use in the expanding DeFi industry, which has seen it become the second largest DeFi market.
Terraform Labs, a Korean blockchain business founded by Daniel Shin and Do Kwon in January 2018, created the Terra blockchain.
Terraform Labs was endorsed by the Terra Alliance, a group of 15 Korean and Southeast Asian e-commerce enterprises.
Terra is one of the few cryptocurrency projects, according to Do Kwon, that takes an outward rather than an inward approach to growth and adoption. Terra is intended to serve as the backend for Terraform Labs’ and the Terra Alliance’s different apps and products.