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LUNA Crashes 70% After Airdrop, Binance May Cause More Pain Tomorrow

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VOC, voice of crypto, LUNA

In Brief

  • LUNA 2 prices have tanked 70% in two days.
  • Binance will begin its airdrop on May 31.
  • Binance users are likely to offload the tokens to recoup losses.

The return of the Terraform Labs ecosystem and its native cryptocurrency has been anything but smooth. Pain could come next for those who hope to hold onto their LUNAs after they’ve been airdropped.

Holders of the old UST and LUNA (Classic) tokens were airdropped with new LUNA tokens on May 27, but there was little reason to celebrate as the values began to drop shortly after.

The token, LUNA 2, has crashed heavily since the airdrops began. It debuted and hit a peak price of just under $19 before dropping 78% to its lowest point on May 28 at only $4.08. The token has been smashed around 70% in just a couple of days, with the Monday morning Asian trading session seeing it trade at just over $6.

It appears that only the centralized exchanges are winning in this situation as they profit from trading fees. The upcoming Binance airdrop could significantly impact LUNA prices in the short term.

More Pain From Binance

The world’s largest exchange has yet to initiate its airdrop, but when it does the sell-off could accelerate according to Terra researcher ‘Terra Watcher.’

The highly anticipated airdrop of Binance tokens begins on May 31. The Terra 2.0 will be listed in Binance’s ‘Innovation Zone,’ a dedicated trading area where new high risk and high volatility tokens can be traded.

The researcher said that Binance has 15.7 million in liquid LUNA, which will be available to users on Tuesday and could cause markets to move because many users will probably dump the tokens since Binance offer their exchange staking service through Anchor protocol.

“Many users had UST on Anchor via Binance at pre-attack snapshot. Many of these users never owned old LUNA and don’t care about new LUNA. Yeah, they’re gonna dump.”

Lark Davis, a well-known crypto influencer, announced that he will be one of those dumping any LUNA 2 coins he gets from Binance in order to recoup some losses.
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Terra Torment Continues

It’s been a rough few days for crypto enthusiasts as prices have tumbled. From memeing to jokes and everything in between, people are finding the humor they need when their investments go south.

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When the airdrop was announced, very few were pleased with its outcome. They had lost thousands of dollars only to be rewarded new tokens that most recipients had promptly dumped on exchanges–and they weren’t even getting an appreciable amount for their loss.
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Jim Haastrup is a freelance blockchain and metaverse writer. He helps founders, investors, startups, crypto, and blockchain enthusiasts connect with their audience and win investment through the written word.

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