Terra LUNA hits new all-time high after 100% rebound from 2022 lows — Correction ahead?
Terra (LUNA) rose to its best level to date on March 29 as the Luna Foundation Guard's (LFG) plans to increase its Bitcoin (BTC) reserves eased anxiety about the impact of an increasingly hawkish Federal Reserve and the ongoing Ukraine-Russia war on crypto markets.
LUNA's price breached above the previous record high of $106.29 by minuscule margins, reversing the losses incurred during the selloff between December 2021 and January 2022.
The latest price rally pushed Terra token's net capitalization crossed $37.17 billion, now making up 1.76% of the entire crypto market, compared to 0.39% at the beginning of this year.
Bitcoin wallets associated with LFG, a nonprofit spearheaded by Terra's creator Do Kwon, saw an inflow of 2,830 BTC worth $135 million on Monday. The influx occurred as a part of LFG's Bitcoin accumulation spree following a community proposal that suggested to use BTC as collateral to "provide deep liquidity at a discount when the UST peg is under pressure."
UST is the Terra's decentralized stablecoin otherwise collateralized by the blockchain's native cryptocurrency LUNA. As such, Terra's economy supports the burning of LUNA tokens to mint more UST units as a strategy to maintain the latter's dollar-peg.
We're seeing some of the earliest and most ambitious ideas in crypto starting to unfoldCrosschain decentralized stablecoin backed entirely by digitally native assets was the holy grail in 2016Bless$BTC $LUNA
LFG has outlined plans to boost its Bitcoin reserves to $3 billion with a long-term strategy to swell the pool to $10 billion. In a theory, that could lead to an increase in demand for UST, thereby forcing more LUNA tokens out of active supply permanently.
From a technical perspective, LUNA faces the
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