The crypto community is full of hopeful people and those who want to capitalize on this fact. Terra Luna was a Ponzi scheme. Now, we know it and we know that it was not sustainable, the attack that exposed the weaknesses of the infrastructure just accelerated the process and, arguably, saved millions of people from being scammed by the empty promises of Terra Luna’s old management.
After the fiasco of Terra Luna, many stablecoins pegged by USD were scrutinized. Tether even started working with established accounting companies to ensure that their balance sheets are in good shape. The attention to stablecoins became excruciatingly meticulous with many people analyzing every step and every transaction of USDC, BUSD, TUSD, and others.
At the same time, a group of users who were interested in Terra Luna decided to revive the project and started working on fixing some issues with the concept. The implementation of the 1.2% tax burn for transactions that will go live on September 12 and several other measures to ensure increased stability and to cut down the supply effectively reducing inflation. These changes immediately increased interest from speculators and investors looking for the next big project with explosive potential.
Just on September 6, the price surged over $60% and reached $0.0004 with an impressive new market cap high of $2.43 billion which is insane considering the troubled past of the asset. These developments seem very exciting and may sway some people toward buying the token, the FOMO aspect of these anxiety-driven purchases is also quite apparent. Many users are buying because they see the line going up, but you should not base your investment decisions on hype alone.
Remember that the fundamentals of the project were not addressed. It is still a stablecoin that has glaring issues and the simple reduction of inflation will not make it miraculously stronger than other stablecoins. There is a long road ahead for the new user-driven management to start being used on various exchanges as a stablecoin.
The news also comes amidst the commotion in the crypto community caused by the announcement from Binance that it will remove all pairs involving TUSD, USDC, and USDP.