Terra Classic up more than 55% in one day: will LUNC bounce back?
Terra investors around the world lost billions of dollars when the algorithmically stable coin project collapsed, but Terra Classic [LUNC], the symbol of the Terra ecosystem, seems to be back again.
However, it’s hard to predict whether the recent spike is a temporary frenzy or will contribute to a better day for investors.
The Terra Classic price on Wednesday was $0.000142 with a 24-hour trading volume of $1,001,400,194. Terra Classic is up 55.56% in the last 24 hours. The current market cap is $933,764,064 according to CoinMarketCap.
The token has 6,554,906,175,581 LUNC coins in circulation.
On the surface, Luna Classic Terra seems to be back. However, the dungeon fell into the abyss in May. Cryptocurrency prices are down by more than 99.99%.
Terra, a $40 billion digital asset ecosystem, collapsed last month in what may be the biggest token crash in crypto history.
UST, once the largest algorithmically stable coin, and the dual token LUNA, designed to stabilize the price of UST, surged to near zero in a week.
Prior to the collapse, both UST and LUNA were among the top 10 cryptocurrencies. The Terra blockchain had to be stopped twice during the crisis.
As countless crypto investors lose their savings to death, developers working on Terra-related projects find their very existence in jeopardy, and other blockchains like Polygon and Kadena woo these developers with millions of dollars in funding.
Part of the community decided to stay put and focus on how to revitalize the project, with Do Kuon, founder of blockchain development company Terra Terraform Labs, leading the experience.
As a result, the two Terra blockchains now run in parallel:
– Old Terra network (original) with tokens renamed to Luna Classic (LUNC) and UST tokens.
– Recently launched blockchain with native token called Luna (LUNA).
Terra investors in India have to factor in taxes
As India’s tax regime for cryptocurrency investments is penalized, TerraUSD and Luna token holders who receive the new coin – known as Luna 2.0 – in the so-called airdrop are facing a double hit.
They can be taxed up to 30% of the value of tokens received and cannot offset the gains from the new tokens with the losses from the previous ones, tax experts say.
Under the new crypto tax rules, which took effect on April 1, all income from “transfers” of “virtual digital assets” will be taxed at a flat rate of 30%. It didn’t specifically mention how air payments should be taxed, but Jay Saita, a technology and gaming attorney, and Manhar Garegrat, executive director of policy at cryptocurrency exchange CoinDCX, said distributions could be considered income and taxed.
“Form in the law is very vague, including the definition of virtual digital assets and the definition of transfer, so this will be open to litigation by the tax department,” the website wrote. “They usually take the most aggressive view of collecting more taxes, although such a view could be unreasonable.”
As of May 9, more than 160,000 investors held Luna, and by May 15 the number in India had increased by 77 percent, according to Rajagopal Menon, vice president of Binance’s WazirX. It is not clear how many other investors hold TerraUSD.
“This increase could be due to a surge in buyers after May 9 when the buyer-seller ratio was 5:1. In terms of volume, Luna’s highest volume was recorded on May 11 and 12 – 53 million USDT together over two days. ,” Menon wrote in an email.
Anush Bhasin, founder of crypto asset advisory firm Quagmire Consulting, said that Luna 2.0’s air launch could fit into the existing definition of a gift, so the gift may not be subject to a flat 30% tax, but the gift is taxed based on the taxpayer’s income or taxes. speed.