Cryptocurrencies Rebound with Uncertainty Looming
Cryptocurrencies have experienced a moderate rebound this week, but the future remains uncertain. For example, Terra Classic (LUNC) saw a slight increase above $0.0001 before correcting to $0.000095 during US business hours on Wednesday.
This market rebound may be short-lived as traders anticipate a lull before an expected pre-halving rally.
The Impact of Halving on Bitcoin and Other Cryptos
Halving is an event that occurs every four years in Bitcoin, reducing miner rewards and decreasing the supply of BTC. This event historically leads to a surge in BTC price due to increased demand, which often positively affects other tokens like LUNC.
1. Terra Classic (LUNC) Approaching Bottom
Terra Classic is approaching a key support level at $0.000054, which was successfully tested in October 2023. If the decline continues, LUNC might explore lower levels, potentially reaching another liquidity sweep at $0.000054.
Although the chart may not look favorable for buying the dip, trading near the bottom price suggests a rebound is likely. Additionally, the Relative Strength Index (RSI) is gradually approaching oversold territory, signaling a bullish opportunity.
2. The Strength of the Terra Classic Community
Despite negative publicity surrounding Terra Classic and other ecosystem tokens, the community has remained supportive of the project. In Q4, this community played a significant role in a commendable rally. With continued backing, LUNC has the potential to reach new highs.
3. Binance Token Burn Program
The Terra Classic community has burned 95 billion LUNC tokens since May 2022, aiming to boost the project’s standing and market performance. Binance has been a major contributor to this token burn program, removing 49.1 billion tokens from circulation.
The upcoming burn round on February 1 is expected to bring the total burned tokens to over 100 billion LUNC.
Hot Take: Terra Classic Must Enhance Development and Utility
The Terra Classic project should focus on increasing network development and enhancing LUNC’s utility to further increase the token burn rate. Currently, the supply stands at 6.81 trillion tokens according to CoinMarketCap.
Source: Coingape
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