- In the last four months since its launch, the response to Terra LUNA 2.0 has improved, but the lack of users continues to be an issue.
- During the week ending September 19, South Korean authorities even asked Interpol to issue a red notice against LUNA founder Do Kwon.
- Persisting fear in the market has slowed down the recovery, leaving LUNA to fall to $2.68.
The Terra ecosystem, which at its peak was the second biggest Decentralised Finance (DeFi) network in the world, shook the crypto market after its collapse. Since then, despite being revived, Terra LUNA 2.0 has been unable to recapture even a fraction of the market it once held.
LUNA goes down
After achieving an almost 230% rally over the course of three days, LUNA began slipping back down on the charts. Within ten days, LUNA trickled down from trading at $6 to trading at $2.7 at the time of writing. This 54.41% decline singlehandedly wiped out most of the growth noted towards mid-September.
But this is not where LUNA would draw the line as the price indicators are actively highlighting further price drawdown. The MACD, which executed a bearish crossover in the same duration as the price fall, is currently heavily bearish, as noted by the red bars.
The conditions are similar on the Squeeze Momentum Indicator, where LUNA being in an active squeeze is noting similar bearishness.
The reason behind this can attribute to two factors. Particular to Terra itself, the first being its co-founder, Do Kwon. Recently, South Korean authorities requested Interpol to issue a red notice against the founder following a refusal to cooperate with the investigation of the Terra ecosystem collapse.
In response to the same, Do Kwon recently tweeted that the allegations weren’t accurate as he was being cooperative.
I am not “on the run” or anything similar - for any government agency that has shown interest to communicate, we are in full cooperation and we don’t have anything to hide
— Do Kwon (@stablekwon) September 17, 2022
The market sees no out
The second and equally critical factor is the “extreme fear” that has been at the core of the crypto market for approximately a month now. The Crypto Fear and Greed Index shows that attempts to escape this zone have not been successful, leaving investors unsure of where the market could be headed, sustaining the Fear.
Since this Fear also has an impact on the broader market, LUNA could start rising again once the said Fear dissipates.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
Celebrity meme coins controversy continues amid Pump.fun revenue dominance
![Celebrity meme coins controversy continues amid Pump.fun revenue dominance](https://editorial.fxstreet.com/images/Resources/CryptoWorldSEO3_XtraSmall.jpg)
Pump.fun outperformed the Ethereum blockchain on Tuesday after raking in $1.99 million. Following this achievement, a meme coin based on actress Sydney Sweeney was the subject of controversy after its developers dumped their bags on investors.
PEPE's on-chain metrics indicate potential rally after weeks of silence
![PEPE's on-chain metrics indicate potential rally after weeks of silence](https://editorial.fxstreet.com/images/Markets/Currencies/Cryptocurrencies/PEPE/PEPE_coin_XtraSmall.jpg)
PEPE has struggled to see any significant price move after reaching an all-time high in May. Increased adoption rate and low MVRV ratio indicate a bullish run may be on the horizon. A single PEPE outflow from Binance worth $14.7 million gives credence to signs of bullish expectation.
Ethereum has failed to overcome key resistance despite bullish sentiment surrounding ETH ETF
![Ethereum has failed to overcome key resistance despite bullish sentiment surrounding ETH ETF](https://editorial.fxstreet.com/images/Markets/Currencies/Digital%20Currencies/Ethereum/ethereum_2_XtraSmall.jpg)
Ethereum (ETH) is down more than 1.4% on Tuesday following another ETH sale from the Ethereum Foundation. Meanwhile, crypto exchange Gemini's recent report reveals that ETH ETF could see about $5 billion in net inflows within six months of launch.
Crypto community blasts Polkadot following report of treasury spending
![Crypto community blasts Polkadot following report of treasury spending](https://editorial.fxstreet.com/images/Markets/Currencies/Cryptocurrencies/Polkadot/polkadot-150x150logo-637399979978734311_XtraSmall.png)
Polkadot reports $87 million of treasury spending during H1. Crypto community members expressed harsh feelings toward the DOT team's high spending. DOT is up more than 2% in the past 24 hours but risks correction following the report.
Bitcoin: BTC price correction could end in July, according to seasonal data
![Bitcoin: BTC price correction could end in July, according to seasonal data](https://editorial.fxstreet.com/images/Markets/Currencies/Digital%20Currencies/Bitcoin/bitcoin_5_XtraSmall.jpg)
Bitcoin (BTC) price appears poised for a decline this week, influenced by slight outflows in US spot ETFs, selling activity among BTC miners, and a combined transfer of 4,690.28 BTC to centralized exchanges by the US and German governments.