The Terra community was in a celebratory mood as the LUNC token saw a significant price surge over the weekend. As revealed by a member of the community, this price surge has been attributed to the actions of the foremost crypto exchange, Binance.
Binance Burns More Lunc Tokens
MrDiamondhandz, a member of the Terra community, hinted in an X (formerly Twitter) post that Binance had contributed to the latest price surge following their recent LUNC token burns. Data from LUNC Metrics showed that the largest crypto exchange burned over 2 billion tokens on February 1.
That move ultimately triggered an increase in LUNC’s price. The crypto token was one of the biggest gainers over the weekend, with its volume surging by over 700% on February 4. On the same day, Binance burned an additional 135,000 LUNC tokens, something which could have contributed to the sustained upward movement.
Token burning is one of the primary mechanisms the Terra community devised to revive LUNC following the LUNA crash in May 2022. This led to the introduction of a 1.2% burn tax on all on-chain transactions, which Binance agreed to implement. The goal is to eventually reduce LUNC’s circulating supply to 10 billion.
Binance’s Contribution To The Ecosystem
Binance has played an active role in helping achieve these token burns. The crypto exchange is the number one LUNC burner, with over 51 billion tokens burned so far. That figure also accounts for 52.2% of all the tokens that have been removed from circulation. Before these February burns, Binance had already burned over 5.5 billion tokens in January this year.
LUNC still has a circulating supply of 5.78 trillion, and a significant portion of these tokens will have to be burned if the crypto token hitting at least $1 is to become a reality. Token burns do not also work in isolation, as there will need to be an increased demand for the token. That explains why the development team continues to take steps to increase LUNC’s utility.
Recently, the team collaborated with Genuine Labs, a group of experienced developers, to integrate IBC Hooks and Packet Forward Middleware into Terra Classic. This move can help enhance liquidity and cross-chain DeFi applications. Terra’s compatibility with the Cosmos chain will undoubtedly help new money flow into the ecosystem.
At the time of writing, LUNC is trading at around $0.0001067, up over 1% in the last 24 hours, according to data from CoinMarketCap.
Token price sustains weekend rally | Source: LUNCUSDT on Tradingview.com
Featured image from Finbold, chart from Tradingview.com
