Terra Classic, also known as Luna Classic, was created as a recovery attempt after the implosion of the original Terra coin, TerraUSD, and its sister coin, LUNA.
In May 2022, the original Terra coin faced a massive collapse, losing nearly all of its value in just a week. In an attempt to halt the collapse, the blockchain was suspended twice. Unfortunately, after this collapse, Terra went on to be the most significant coin collapse in crypto history to date.
Before the collapse, Terra was in the top 10 cryptocurrencies in the world. Before the collapse, the asset was worth over $40 billion. When it collapsed, thousands of investors lost thousands of dollars. In many cases, investors lost their life savings.
After the collapse, some founders, spearheaded by Do Kwon, stayed on to rebuild the project. The efforts turned the Terra project into two different blockchains. One was the original blockchain, which was rebranded to Luna Classic (LUNC). The other blockchain was a brand new coin named Luna (LUNA).
Two versions of the coin were made during the plan Do Kwon proposed to revive the Terra project. The proposal was named the Terra Ecosystem Revival Plan 2.
He planned to make a new blockchain with a "fork." In coding terms, a fork is a means of modifying the existing code in an open-source fashion. The modifications happen side by side with the original so that the two exist simultaneously. A "fork" is often used in coding to test new code changes.
Once the new blockchain was created, the plan was to hand out the new LUNA tokens to investors who still held the old UST and LUNA tokens. The program thankfully went ahead, allowing the creation of LUNA and the redistribution of tokens.
The new coin, Terra 2 (LUNA), was launched on May 28th, 2022. As was the plan, it runs in parallel with the old blockchain, which was subsequently renamed Terra Classic (LUNC). At this time, Terra Classic is still live, but there are no plans for future development. Currently there is no activity on the project.
As noted above, Terra was initially divided into two coins, the TerraUSD and the sister coin, Luna. The original reason for the sister coin was to add stability to the price of the TerraUSD currency. The way TerraUSD was designed, it was meant to keep its price around 1 USD at all times. It did this by minting and destroying coins needed to remain around that price.
It eventually collapsed because the algorithm initially made to hold the price near a dollar started to create trillions of new coins when the price dipped. As a result, it set the code into hyperinflation, depleting its value in under a month. This article will cover all the reasons why this happened, and how to invest with confidence moving forward.
LUNC was created at Terraform Labs, based in Seoul, South Korea. The CEO of Terraform and one of the leading creators of UST, LUNA, and LUNC is Do Kwon.
Terraform labs has also worked on other projects, including Anchor Protocol, Astroport, and Mirror Protocol.
The Terra ecosystem is built on the notion of stablecoins. Stablecoins are a type of cryptocurrency where the price is pegged on an existing reference currency. The reference currency can be another cryptocurrency, fiat, or exchange-traded commodity. In the case of Terra, the price is pegged to 1 USD.
At the time of creation, LUNA was designed to be swappable with $1, regardless of the price of either currency. After the collapse and rebuilding, those old Terra coins became LUNC.
The LUNC coins work a little bit differently now. Terraform Labs is no longer developing Terra Classic but is actively working on Terra 2 (LUNA). The Terra Classic coin can be instead exchanged for Terra 2 coins. The current exchange rate at the time of writing this is 1 LUNC for 1.03 LUNA.
The main purpose of LUNC now is to be exchanged for LUNA. Terraform Labs are no longer developing the LUNC coin, but the project did not want to drop Terra Classic entirely. Instead, their revival plan included a means for old Terra investors to trade up to the new Terra coin.
When Terra was first created, the creators wanted a coin that could be used as a decentralized, price-stable coin. Its aim from the beginning was mass adoption so that going into the future, the currency could be used in place of traditional financial institutions.
They also wanted to strip hidden fees from everyday transactions, a norm for traditional banking.
LUNC was designed so that users could modify it slightly for their projects and apps.
Today, those goals have been transferred to the Terra 2 (LUNA) coin. The only purpose of LUNC now is to give original Terra investors a means to trade from Terra Classic to Terra 2, as Terra Classic is no longer being developed after the collapse.
What makes LUNC unique is its history. Investors have always been warned that the crypto market can be highly volatile. You can win big, yes, but you can also lose big.
While some of the larger coins, such as Bitcoin, Ethereum, and Ripple, have proven their ability to be stable in the long term, Terra Classic works as a cooling reminder of what can happen under the wrong circumstances.
Another aspect that makes LUNC unique is that it sits mainly as a legacy coin at this point. You can still purchase it, but the incentive is to move on to Terra 2 instead.
Make sure you have an account with Knaken. You can register in the app or at the registration page. Then verify your personal data, and you are ready to buy Terra Classic.
You can select Terra Classic in the app or web portal, choose an amount and immediately make the payment with, for example, a credit card.
Yes, at Knaken you can easily buy Terra Classic with, for example, iDEAL, credit card or Bancontact. Check all options on our fee page.
You can find the current price of Terra Classic at the top of this page.
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Take a look at our costs page for more info.
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Search for Terra Classic in the app or web portal and select “deposit” in options. Here you will see the deposit address where you can send the crypto. Make sure you deposit Terra Classic from a wallet address that has been verified with Knaken.
Yes, search for Terra Classic in the app or web portal and select the withdrawal button in options. Please note that you can only withdraw Terra Classic to a verified wallet address.