Luna 2.0 is dubious over its potential, Analysts react to the new token

livemint.com:

Since the backers of the failed Terra blockchain launched a new digital token to compensate investors burned by one of crypto’s biggest busts, the blows have kept coming. 

Luna 2.0, as the coin is known, emerged out of the ashes of crypto entrepreneur Do Kwon’s ecosystem, which collapsed after the TerraUSD algorithmic stablecoin at the center of it dropped from its dollar peg in early May. But any hopes of a quick recovery for investors who lost billions of dollars in the crash are fading, with the token losing more than half of its value in the past week alone, based on data from CoinGecko. 

Scrutiny from securities regulators in the US and police in South Korea is adding to the woes. The US Securities and Exchange Commission is investigating whether the marketing of TerraUSD violated federal investor-protection regulations, Bloomberg News reported Thursday. In Seoul, police are examining allegations that staff of Luna backer Terraform Labs embezzled Bitcoin holdings amassed to help defend TerraUSD’s peg to the dollar. 

Four market watchers asked about their views on Luna 2.0 expressed skepticism about the coin’s prospects, and that of the new blockchain it runs on. Here’s what they had to say:

Mati Greenspan, founder of Quantum Economics:

“Luna 2 was never meant to survive, it was simply a mechanism for some who were heavily invested to recoup some of their losses at the expense of new money coming in from the hype. I don’t see any reason for the price to go up ever." 

Kunal Goel, research analyst at Messari:

“Terra 2.0 suffers from multiple problems. It has gone live in an unfavorable macro and crypto environment. Without an algorithmic stablecoin, it has no clear point of differentiation from other smart contract