The Terra project is now clearly dead, but there is a revival plan in place and Binance CEO CZ hopes it will work.
Binance CEO CZ hopes for a revival of the Terra ecosystem
However, there are many who doubt that it will work, not least because in that same plan, Terra is again referred to as a project based on “decentralized money”, whereas reality has clearly shown that Terra is not a decentralized project at all.
Many are convinced that ultimately there will be no real plan to relaunch the Terra project, which is now thought to be dead, but at most the reconstruction from scratch of another similar project, derived from what remains of the one that has now gone up in smoke.
Binance founder Changpeng CZ Zhao also seems to think so, saying in a recent tweet that he hopes the project team can rise from the ashes.
8/ I am just hoping that the project teams can rise from the ashes and rebuild in a proper and sensible way. Regardless of my personal views, or the solution chosen in the end, we will always be here to support the community in any way we can.
— CZ 🔶 Binance (@cz_binance) May 15, 2022
The tweet does not specifically mention Terra, but is part of a thread clearly dedicated to the project. In fact, in another tweet CZ says that in recent days they have tried to support the Terra community, but also adds that forks or burns do not create value.
According to CZ, in order to do things right, the Terra project now needs funds, which it may not have.
5/ The last few days, we tried hard to support the Terra community. In my tweets, I am simply pointing out the potential issues from my understanding. Minting, forking, don’t create value. Buying back, burning does, but requires funds. Funds that the project team may not have.
— CZ 🔶 Binance (@cz_binance) May 15, 2022
CZ asks the team for more transparency, starting with public on-chain transactions of all the various funds of the project managers.
Where is the money of the Luna Foundation
To date, this is still one of the most critical and thorny points regarding the implosion of Terra: where are the billions of dollars that the team managed to try to support UST’s peg with the dollar, now that the peg has definitely blown up?
According to a study published by Elliptic a few days ago, the money “held” by the Luna Foundation Guard (LFG) to secure the peg was actually on exchanges such as Binance and Gemini.
The post published by Elliptic explained:
“The entirety of this 52,189 BTC was subsequently moved to a single account at Gemini, the US-based cryptocurrency exchange – across several bitcoin transactions. It is not possible to trace the assets further or identify whether they were sold to support the UST price”.
The report then adds:
“This left 28,205 BTC in Terra’s reserves. At 1 a.m. UTC on May 10th, this was moved in its entirety, in a single transaction, to an account at the cryptocurrency exchange Binance. Again it is not possible to identify whether these assets were sold or subsequently moved to other wallets”.
Meanwhile, it appears that the wife of the project’s founder, Do Kwon, has sought police protection after someone allegedly broke into their flat in Seongdong-gu district in Seoul.
The price of Luna
In the meantime, many exchanges have resumed trading the various pairs with LUNA, and the past few days have seen real historical peaks in trading volume.
It is enough to think that on Saturday 14 May alone, the price of LUNA rose by 6,000% in a few hours, before falling again by 70% the following day. Previously, however, it had lost almost 100% compared to the pre-crash price.
In other words, these are now purely speculative movements, because as of today, Terra seems for all intents and purposes a dead project, as does its native cryptocurrency, LUNA.
Since such speculative movements can also lead to strong gains in certain cases, trading continues, despite the fact that the medium-term trend is still very bad and despite the fact that it is still possible to lose a lot.
At the moment, the price of LUNA is 22,000% above the all-time low reached on Friday 13 May 2022, but is still almost 100% below the high of 5 April.
In the last 24 hours, volumes have fallen quite a bit compared to those of Saturday, and especially compared to the highs of the days of the crash, from 10 to 12 May, returning more or less to the levels of 9 May.
Once the speculative hype has also died down, it is possible that the market may slowly end up forgetting about Terra and LUNA, unless – as suggested by CZ – the project is reborn from its ashes with something different from what it was until a few days ago.