As one of the solutions proposed by Terra LUNA’s CEO, Do Kwon, the creation of LUNA 2.0 was the most controversial on the table.
LUNA 2.0 is a “second version” of the very well-known LUNA, which dove deep down into the crypto mausoleum as a result of UST’s massive sell-out recently.
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As many people were desperately seeking solutions and wondering if there were any, a great deal of discussion was sparked in the crypto community regarding ways to try to repair the damage.
Of course, the CEO responsible for the Terra project was looked after, since he would be the one to execute some of those ideas. In response to the first reactions, he stepped into the open and offered the idea for LUNA 2.0 as a way to bring back his beloved project.
Nevertheless, the idea didn’t sit well with all, as many people started to see holes in it. However, we would later discover they were somewhat accurate.
The hard forking of LUNA
LUNA 2.0 would work as a hard-forked version of the previous “mother” LUNA.
For those who don’t remember, hard forking is the act of “copying” the original blockchain into a new one.
This was an attempt to separate the first LUNA from the new one.
However, we are talking here about hard forking.
The difference between a hard and a soft forking revolves around the software of the blockchain. Hard fork results in a software that is completely new and incompatible with the previous blockchain software and the nodes would only be able to communicate with the new version.
As for soft forking, it is the opposite: it generates a new blockchain that is compatible with the previous version. In LUNA’s case, Kwon suggested a hard one, since it would be completely disconnected from the first LUNA.
The major difference here lies in the fact that the new LUNA would not be ‘linked’ with the stablecoin UST, which the Terra project created in order to have a ‘balance’ for LUNA in this volatile crypto universe.
Since it was UST’s massive sell-out that caused all of this mayhem, it’d make sense that getting rid of it would be a good solution.
The new LUNA would keep this name as the first one started to be called ‘LUNA Classic’. The same with the blockchain Terra, as the new one keeps the name, and the previous one is now called ‘Terra Classic’.
The controversy
The idea of LUNA 2.0 seems to make sense since the whole dynamic of ‘UST/LUNA’ was the main villain of this plot.
However, it has been brought to attention by many crypto enthusiasts that creating more coins, for a doomed project, would be the worst plan.
Even though LUNA Classic worked pretty well and had its fans, it’d be obvious that by now their confidence in their beloved project would be shaken.
Even Binance’s CEO, Chanpeng Zhao, brought this up on his social media when he said:
Zhao listed some factors of why he thought this idea wouldn’t work, including that “forking does not give the new fork any value. That’s wishful thinking” and “one cannot void all transactions after an old snapshot, both on-chain and off-chain (exchanges)”.
However, even disagreeing with this proposal, after LUNA 2.0 came to life, Binance listed the coin in an attempt to help the project.
LUNA 2.0’s failure?
The new version of LUNA was released on May 28th.
Since then, a lot of highs and lows defined the journey of the new and improved LUNA.
The coin had a bad beginning since the shaken confidence of many prevailed in the first moments. It was listed for $17 but soon dropped to a price around $5.
However, as soon as Binance listed it, the price of LUNA 2.0 went up to 90%, coming to a price of $9,20.
Even though it seemed like a good sign, it was only a matter of time until things started to crumble again, and, now, at the moment of this article’s writing (Jun 5, 2022), LUNA 2.0 lists as $4,66 according to CoinMarketCap.
People’s opinions about the second version of the coin are split, as shown in the highlighted Twitter comments about it.
A user said:
“$LUNA 2 real good. $30 within 4 days. Mark my words. $100 within 30 days. Total supply 1 bil only, 210 mln in circulation. Old investors won’t sell until at least breakeven, new investors are hyped AF and see it as an opportunity. Worldwide “bad” publicity,…is it really bad??”
https://coinmarketcap.com/gravity/post/312432061` `
Another user was more skeptical, as he wrote:
“$LUNA I guess now we learned the hard way why a fork doesn’t work, whatever happens to LUNC happens to LUNA & vice versa, so with LUNC being at a megaloss there’ll be no gain without this type of megarisk, there will be occasional opportunities but this will just repeat x100”
https://coinmarketcap.com/gravity/post/314143868
Stay alert, DYOR and be Klever.
