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Things To Know About Terra (Luna) Token

Terra (Luna) is one of the leading crypto assets in the crypto market which has an all-time high in 2021. The cryptocurrency whose token is known as ‘Luna’ is hot on investors’ list.

Terra makes it into the top 10 among tens of thousands of coins today as it is ranked 9th by CoinMarketCap. As crypto investors look to try out the less popular coins, Terra has been a good choice to consider.

Despite the hype around Terra, it is important to research and understand the risks before investing in it. In this post, we’ll learn about Terra and its token, Luna.

What is Terra (Luna)?

Terra is a blockchain protocol that uses fiat-pegged stablecoins to produce price-stable global payment systems. It was created by Terraform Lab and its co-founders Do Kwon & Daniel Shin in 2018 and launched in 2019.

The asset was created to combine the price stability and wide adoption of fiat currencies with the censorship resistance of Bitcoin.

Terra trades by the symbol, Luna which has the current price of $83.16. It has a trading volume of $2,663, 08, 357 with a market cap of $29.67 billion. The circulating supply of the token is 356, 813, 428 LUNA coins.

Terra Luna coin
Terra Luna coin

Important Things To Know About Terra

1. The Terra protocol is an open-source stablecoins network controlled by its stakeholders. Its holders are granted governance rights and voting power for the protocol.

2. The Terra blockchain underpins a decentralized finance (DeFi) ecosystem that creates algorithmic stablecoins.

3. Terra is the second-largest DeFi protocol (has 13 protocols), only behind Ethereum (373 protocols), according to data provider DeFi Lama.

4. Luna is used to generate Terra’s stablecoin pegs. This means that it is in center of the shock absorption process if something goes wrong with the stablecoins on the platform.

5. Luna hit an all-time high in December, 2021 after starting the year priced below $1. As of January 2022, it trades at $83.16.

Is It Safe To Invest In Terra?

It is important to know that there are much risk attached to crypto assets which doesn’t exclude Terra. Financial experts view cryptocurrencies as volatile, speculative investments. As quickly as one reaches a new high, it could go back down.

As for Luna, the bigger risk is that investors could be subject to losses if Terra’s stablecoins are unable to hold theie pegs. The acts as a sort of volatility absorption mechanism for Terra’s stablecoins. This could make it correspond with that of Terra’s blockchain.

Although the token is currently doin well, its impossible to predict its future performance. It is unknown if it will be able to withstand high volatility or a bear market.

It is also important for investors to be aware of any regulatory issues within a protocol if investing in a crypto asset.

In Conclusion

Investment in crypto assets is no doubt without risks. It is advisable to invest as much as you can afford to lose in Terra & other assets due to this risks.

If you’re really investing in any token, the potential for large price swings should be considered and understood before putting your money.

Also Read- What is Floki Inu Coin?

 

 

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