Cross-chain integrations and the growing popularity of Terra’s UST stablecoin are just a few of the factors behind LUNA’s recent rally to a new all-time high. Stablecoins are an integral part of the the centralized crypto sector and the decentralized finance (DeFi) ecosystems that have sprung up over the course of the past few years because they provide the liquidity needed for traders to easily swap into different assets. They also serve as a shelter against strong downside swings like the 25% correction seen on Dec. 3.
One project with a stablecoin component that has seen its price surge to a new all-time highs despite the wider market pullback is Terra (LUNA), a multi-sector blockchain protocol aimed at building a global payments system through the use of a fiat-pegged stablecoin called TerraUSD (UST).
Data from Cointelegraph Markets Pro and TradingView shows since hitting a low of $37.86 on Nov. 26, the price of LUNA has surged 106% to a new all-time high at $78.43 on Dec. 5 as its 24-hour trading volume spiked to a record $5.66 billion. Three reasons for the breakout in LUNA price include the increasing supply of UST, a series of new cross-chain integrations for the Terra ecosystem and a surging total value locked (TVL) on the Terra network.
One of the main drivers behind the strength seen in LUNA has been the rapid growth of the circulating supply of UST, which is now the largest algorithmically-backed stablecoin in the market and the fourth-ranked stablecoin with a market cap of $8.221 billion. Crypto proponents in favor of decentralized stablecoin options have embraced the use of UST in comparison to its more centralized counterparts USD Coin (USDC), Tether (USDT) and Binance USD (BUSD).
As the popularity of UST grows, many in the field have begun referring to it as ‘The DeFi dollar’ because it embodies the ethos of decentralization and is slowly spreading across the multi-chain DeFi landscape.
LUNA is also available across a few cross-chain bridges, making it easier for LUNA holders to invest their in DeFi ecosystems on Ethereum (ETH), Solana (SOL), Fantom (FTM) and Polygon (MATIC). Related: Decentralized exchange aggregator trading volumes surge to new highs. Total value locked on Terra hits an all-time high
Increasing use of LUNA and UST pushed the total value locked on the Terra blockchain to a new all-time high at $14.36 billion on Dec. 5th and LUNA price hit a record-high on the same day.
The rapid rise in TVL has resulted in Terra becoming the third-ranked blockchain network in terms of TVL after it surpassed Solana, which has $12.08 billion in value locked on its protocol, while the top-ranked Ethereum network boasts a TVL of $164.72 billion and the Binance Smart Chain has $22.4 billion in value locked on its blockchain.
VORTECS™ data from Cointelegraph Markets Pro began to detect a bullish outlook for LUNA on Nov. 24, prior to the recent price rise. The VORTECS™ Score, exclusive to Cointelegraph, is an algorithmic comparison of historical and current market conditions derived from a combination of data points including market sentiment, trading volume, recent price movements and Twitter activity. As seen in the chart, the VORTECS™ Score for LUNA began to pick up on Nov. 24 and reached a high of 85 around the same time as the price began to increase 106% over the next eleven days.
|#||Crypto||Prediction||Accuracy||CVIX||Price||24h||7d||Market Cap||7d price change|
|1||BTC||Bitcoin predictions||80.8%||35||$22 939.67||-3.65%||-0.43%||$438 548 196 646|
|2||ETH||Ethereum predictions||66%||68||$1 680.06||-5.25%||2.68%||$204 805 525 877|
|3||USDT||Tether predictions||95.6%||1||$1.000237||0.01%||0.01%||$66 533 700 340|
|4||USDC||USD Coin predictions||96%||1||$0.999848||0%||-0.03%||$54 011 865 153|
|5||BNB||Binance Coin predictions||70%||62||$319.45||-1.52%||10.96%||$51 538 467 752|
|6||BUSD||Binance USD predictions||96%||1||$1.000292||0%||0.01%||$17 756 480 503|
|7||XRP||XRP predictions||77.6%||36||$0.362409||-3.72%||-2.15%||$17 519 965 274|
|8||ADA||Cardano predictions||71.6%||50||$0.510338||-4.17%||0.93%||$17 218 297 210|
|9||SOL||Solana predictions||73.6%||44||$39.52||-6.65%||2.24%||$13 768 809 765|
|10||STETH||Lido stETH predictions||93.6%||1||$2 941.39||-0.40%||-3.32%||$10 258 752 564|
|11||DOT||Polkadot predictions||68.4%||62||$8.65||-4.95%||7.88%||$9 563 739 618|
|12||HEX||HEX predictions||64.8%||70||$0.054819||1.28%||19.27%||$9 506 188 307|
|13||DOGE||Dogecoin predictions||82%||28||$0.068036||-7.62%||1.11%||$9 026 356 228|
|14||AVAX||Avalanche predictions||72.4%||55||$27.33||-3.28%||16.23%||$7 788 396 850|
|15||DAI||Dai predictions||92%||1||$0.999960||0.02%||-0.02%||$7 525 786 587|
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