New Luna's Rollercoaster Ride Right After Listing... Trading Volume Drops 46% in One Day

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Lee Jung-yoon] Terraform Labs, the issuer of Luna and TerraUSD (UST), which experienced a crash, has launched the blockchain ecosystem 'Terra 2.0' and listed the new cryptocurrency Luna (Luna2) on overseas exchanges. However, the price plummeted, dropping nearly 80% within less than a day after listing.

According to the global cryptocurrency market tracking site CoinMarketCap as of 9:50 a.m. on the 30th, Luna's price was $5.83 (approximately 7,302 KRW), up 17.61% from the previous day. CoinMarketCap began tracking Luna's price from 6 p.m. on the 28th, when the price was recorded at $17.8. Afterward, Luna's price fell to $13.27 within 20 minutes, then surged to $19.53. However, the price dropped again, sliding down to the $5 range. Notably, between 7:15 p.m. and 7:20 p.m. on the 28th, the price sharply fell from $13.83 to $8.21 in just five minutes. It also dropped to $3.93 that day, which is a 79.88% decrease from the highest price within less than a day after listing.

The decline in trading volume is also evident. On the first day of listing, the trading volume on the 28th was $281.6 million (approximately 352.5 billion KRW), but it sharply decreased by about 46.72% to $150.04 million (approximately 187.8 billion KRW) the next day.

The sharp drop in Luna's price and the rapid decrease in trading volume appear to be due to distrust in Terraform Labs. Terraform Labs announced it would airdrop new coins to holders of the existing cryptocurrency Luna Classic and the stablecoin TerraUSD (UST), which was designed to peg to $1. An airdrop means distributing new coins free of charge to holders of existing cryptocurrencies, but since trust has already been broken, expectations are not high. Earlier, Vijay Ayyar, Vice President of the cryptocurrency exchange Luno, said, "There has been a significant loss of trust in the entire Terra project," adding, "There are already many well-established platforms with active developers. I don't see why Terra should succeed here." Terraform Labs has also actively promoted the project by posting phrases like "Terra 2.0 is here" on its homepage, but the market response remains cold.

Currently, Luna is listed on overseas exchanges, and according to CoinMarketCap, it is tradable on a total of nine exchanges. Notably, it is listed on Singapore-based exchange Bybit and Chinese exchange Huobi Global. However, it seems unlikely that Luna will be listed on the five major domestic exchanges operating KRW markets. Exchanges have stated they will support the airdrop but clarified that this does not mean they will support trading of Luna.