Several tokens tied to the two Terra ecosystems – Terra 2.0 and Terra Classic – more than doubled over the past week, extending year-to-date gains to more than 10,000% in what could mark one of the best project reversal stories in the crypto industry.
"Many established Layer 1 (L1) public blockchain networks have encountered significant hurdles; Ethereum faced the DAO hack, Solana experienced network outages, and Bitcoin underwent hard forks," said James Wo, founder at crypto fund DFG in a Telegram message to CoinDesk.
"Despite facing a supposedly fatal blowup event, it didn't undermine the strength of the community and the technology at its core. Terra stands out as a community filled with motivated and skilled individuals. Through strategic realignment and adaptability, they are demonstrating resilience and unwavering belief in the Terra ecosystem. It's a story worth watching," Wo added.
Cumulative trading volumes crossed the $2 billion mark, data from CoinGecko shows.
Terra Classic is the original network created by Terraform Labs. It has continued as an independent blockchain rather than Terra 2.0, which is a forked version that was created in the wake of Terra's collapse. Terra 2.0’s LUNA is now actively traded on the market, and so are Terra Classic’s LUNC and USTC, the original tokens.
These pumps came on various catalysts. Last week, Terraform Labs said it had put $15 million towards two projects in the Terra ecosystem to buffer up liquidity, making certain trading pools on those platforms more attractive for on-chain traders.
Last month, Bitcoin-focused payment project Mint Cash said it was working on a USTC revamp plan that would use bitcoin (BTC) to back its intended dollar-pegged stability. The team said it would also have an airdrop plan in place for LUNC and USTC holders.
Meanwhile, crypto exchange Binance continued to a burn scheme that permanently removes LUNC from circulating supply based on transactional fees earned on LUNC trading pairs.
In June, six engineers calling themselves the “Six Samurai” proposed a Terra Classic ecosystem revival plan for the blockchain – such as a terraUSD testnet for testing financial services, an application for generating yield to token holders, and a plan to reward developers for the user activity that their applications generate.
The infamous Terra network, helmed by Do Kwon, collapsed in May 2022 as a mechanism to back the algorithmic stablecoin terraUSD (UST) faltered – leading to Terra’s LUNA and UST tokens falling 99% in the weeks afterward.
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