Discover Terra (LUNA) with the LiteBit exchange
We’re two weeks into 2022, and the crypto market isn’t showing any determined trend, be it upward or downward. In times as vague as these, it always pays to take your eyes off the big players and explore new and promising places to invest. Available on the Litebit exchange, alongside many other tokens, the Terra project and its LUNA coin are still revealing aces up their sleeves. Let’s explore the details of the project (currently ranked 9th by total market cap).
Litebit, the European crypto gem
Before going into the details of the Terra project, it’s worth revisiting the Litebit exchange for those who don’t know it. Founded in the Netherlands in 2013, Litebit is a cryptocurrency broker. It allows you to trade and hold more than 60 cryptocurrencies. Not long ago, we put together a list of all the cryptocurrencies available on the exchange (45 at the time). The increase points at the growing vitality of the project and its willingness to provide a diverse range of products.
Also, the exchange has been approved by the Financial Markets Authority (AMF) since 2021. After obtaining the PSAN certification (Digital Asset Provider), Litebit became a fully regulated company. The platform plans to settle permanently in France and expand across Europe.
The Terra project: boosting monetary innovation
Terra’s goal is as simple as it is ambitious: to offer stable, decentralised digital currencies accessible to everyone. The white paper of the project points to a desire to merge the ubiquity of fiat currencies with decentralisation.
The development of the Korean project began in 2018, and its mainnet launched in 2019. That makes the project remarkably young compared to the other cryptocurrencies in the top 10. With the relevance of its technology, LUNA had managed to quickly earn the trust of many people and is currently on top of the game.
The Terra project issues the decentralised stablecoin UST pegged to the US dollar. Spearheading the project, the UST is the flagship product of the Terra ecosystem.
The difference between traditional and algorithmic stablecoins
Commonly referred to as an “algorithmic stablecoin,” the UST is governed by computer mechanisms that allow it to remain stable. Unlike USDT, for example, which is issued by the company Tether and backed by real-world USD, UST is managed entirely by algorithms. The latter “burn” or “print” USTs according to price fluctuations. This mechanism adds a layer of security to stablecoins, preventing any individual at the head of the project from “running off with the cash.” This mechanism is also available for other stablecoins — those pegged to the Korean Won or the Euro, for example.
The LUNA token
Like many projects, Terra has introduced its governance token: LUNA. Available on the Litebit exchange, this token maintains the balance of the Terra ecosystem. First, providing LUNA liquidity to the protocol strengthens the mechanism. Also, LUNA serves as a guarantee for the UST. If the algorithm detects a rise in the price of UST, LUNA suppliers get more UST. Conversely, if the price falls, USTs are withdrawn from circulation and users receive LUNAs. Thanks to this mechanism, UST is constantly worth $1, and LUNA is there to keep it this way.
Also, LUNA lets you pay transaction fees on the blockchain. Based on Cosmos technology, Terra runs on all major blockchains. Cosmos specialises in interoperability between blockchains and therefore promotes the adoption of many projects, including Terra.
Currently priced at $85/€74.4, the Luna token is not going to stop there.
Litebit is full of innovative projects with impressive performance. Trusted and ever-growing, Litebit has added nearly 20 cryptocurrencies in 2 months. In the coming days, we will provide you with a detailed description of the projects listed on the platform. Also, Litebit has a mobile app, allowing you to keep an eye on the market at all times.
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The views, thoughts, and opinions expressed in this article belong solely to the author, and should not be taken as investment advice. Do your own research before taking any investment decisions.