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Former FTX Executive Accused of Fueling a Charity Through Discounted FTT PurchaseA former executive of FTX allegedly earned profits for a charity by purchasing discounted FTX tokens, FTT, before they became available to the public at $0.05 per unit, according to a report citing anonymous sources. Ruairi Donnelly, the former chief of staff at FTX, has been accused of donating the tokens to Polaris Ventures, a […]

Voyager’s $1B sale to Binance.US put on hold by US court

Terra price gains 75% in February as $2.57B in LUNA tokens removed from supply

The token burn appears as the supply of UST, Terra's stablecoin, rises by nearly 14.75% in the month.

Terra (LUNA) emerged as one of the best performing financial assets in February, a month mired by geopolitical conflicts and their negative impacts on the crypto market.

LUNA decouples from the crypto market

LUNA's price surged by a little over 75% to reach $91.50 at the month's UTC close. In comparison, the percentage performance of other top tokens, mainly Bitcoin (BTC) and Ether (ETH), in the same period came out to be around 12.25% and 9%, respectively.

LUNA/USD versus BTC/USD and ETH/USD weekly price charts. Source: TradingView

Interestingly, most of LUNA's gains in February surfaced on the month's last day. The Terra token jumped 26% on Feb. 28, in part due to similar upside moves elsewhere in the crypto market. For instance, BTC and ETH rose 14.50% and over 11.50%, respectively, on the same day.

While still positive at 0.09, LUNA's correlation with Bitcoin has come off lately after hitting 0.81 on Feb. 21, data from TradingView shows. A correlation of 1 means that two assets are in lockstep, while 0 shows that their price moves independently.

LUNA/USD correlation coefficient on the daily chart. Source: TradingView

Terra's LUNA/BTC pair also showed its growing valuation against the top cryptocurrency.

In detail, the LUNA/BTC pair rose by over 56% to 21,171 satoshis in February, suggesting traders sought hedge in the Terra token as Bitcoin's correlation with a bearish stock market grew, reaching 0.70 earlier this year.

Bitcoin correlation with stocks since March 2021. Source: Bloomberg 

As to why traders appeared to have considered LUNA as their interim safe haven in the first place, the answer might lie in Terra's token economics.

29M Terra tokens destroyed

Data fetched by analytics platform Smart Stake showed that Terra protocol burned 29 million LUNA tokens worth $2.57 billion recently. That happened as the supply of TerraUSD (UST), a stablecoin backed not by the U.S. dollar but LUNA, increased from around 11.26 million on Feb. 1 to almost 12.92 million on Feb. 28, marking an increase of nearly 14.75%.

LUNA and UST supply all across February 2022. Source: Smart Stake

Traders consider an increasing UST supply a bullish catalyst for LUNA, mainly because of the so-called UST-LUNA token model. In detail, Terra preserves UST’s peg of USD through an elastic monetary policy. So when the value of UST goes above $1, Terra incentivizes its users to burn LUNA and mint UST.

But when the UST supply contracts, LUNA valuation decreases due to a slowdown in the burning mechanism. All and all, LUNA's valuation tends to rise alongside UST's supply.

On Feb. 22, the Luna Foundation Guard (LFG) — a nonprofit organization supporting the Terra blockchain ecosystem, announced that it had raised $1 billion in a LUNA token sale round led by Three Arrows Capital, a venture capital firm backed by Ethereum-skeptic Su Zhu and Jump Crypto, a trading group known for assisting Solana's cross bridge platform Wormhole in replenishing their stolen $300 million.

LFG revealed that it would use the proceeds to build a "UST Forex Reserve," raising prospects of boosting the stablecoin's supply by another billion-dollar worth of LUNA-backed tokens.

LUNA's price has risen by nearly over 90% since the LFG's announcement. In contrast, the total market capitalization of all the cryptocurrencies combined has rallied by just 13% in the same period, underscoring that crypto traders have been flocking into the Terra market.

What's ahead for LUNA?

Terra's technical outlook looks skewed to the upside owing to an ongoing "bull flag" breakout move.

Bull flags are bullish continuation patterns that appear when the price consolidates lower inside a descending channel after a strong move upward. Eventually, it breaks out of the channel range to the upside, with a price target ideally at length equal to the size of the upside move that preceded the bull flag formation.

LUNA appears to have entered the final phase its bull flag setup, as shown in the chart below. It now eyes a run-up toward $120, an all-time high for Terra if achieved.

LUNA/USD three-day price chart featuring bull flag setup. Source: TradingView

On the flip side, LUNA's volumes on the three-day chart appear weak, showing the ongoing upward retracement remains less convincing to traders. Its volume profile also shows little historic activity above $70.

Related: $300M in crypto liquidations accompanies Bitcoin's surge to $44K

Additionally, LUNA's daily relative strength indicator (RSI) has been flashing an "overbought" warning, noting that it could go a degree of price correction in the coming sessions.

LUNA/USD daily price chart featuring RSI. Source: TradingView

Nonetheless, in the long term, the Terra token's path of least resistance remain to the upside, with its year-over-year performance against the dollar coming out to be over 1,200% as of Feb. 28, 2022.  

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

Voyager’s $1B sale to Binance.US put on hold by US court

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Voyager’s $1B sale to Binance.US put on hold by US court

CoinList ‘Rally’: 40K investors rush to buy RLY despite price pump

Rally has generated $22 million in sales from its liquid token sale on April 4, which attracted 40,000 investors.

Social token platform Rally has completed its first “liquid token sale” on crypto asset issuance platform CoinList, with 40,000 investors snapping up RLY tokens for $0.60 each between April 1 and April 4.

The sale saw tokens distributed to investors at a set price despite RLY trading on exchanges since October, 2020. Token pricing was determined by a 20-day trailing average from March 11, 2021 to March 30, 2021 minus a 30% markdown to compensate for the RLY being locked up for 12-month a linear release.

However, investors had the opportunity to purchase RLY for less than half the price offered by CoinList on the open markets just five weeks ago.

The sale was approved through community governance in mid-March, with the 40 million RLY sodl having previously been allocated to Rally’s Community Treasury. The ballot saw 100% of the 7,400 participating token holders vote in favor of the sale. Nearly 30% of RLY are now held by Rally’s team and investors.

News of the sale appeared to drive bullish momentum for RLY, which has gained nearly 250% since trading for less than $0.29 on March 12. RLY consistently traded between $0.25 and $0.35 from mid-January until mid-May. As of this writing, RLY last changed hands for $1.

RLY/USD: CoinGecko

Half of the tokens will become tradable on Oct. 4, after which the remaining RLY will unlock gradually on a monthly basis. In a blog post on April 12, Coinlist revealed the offering generated $22 million. Investments were limited to $1,000 per person, with nearly two-thirds of the offering’s 115,000 registrants missing out on participating.

Rally is a blockchain-based social network that allows content creators to launch social tokens.

The social token sector — non-fungible tokens issued by content creators, brands, and communities — has been on the rise in 2021, with RLY and WHALE representing 83% of the social token market cap pack with $240 million combined.

Voyager’s $1B sale to Binance.US put on hold by US court