About Terra:

After the sudden and horrific collapse of the Terra network, many investors are worried about the future of the stablecoin Terra and the Luna Classic blockchain. Although Terra Network was completely destroyed, the founders quickly launched a new version called Terra 2.0.

Terra 2.0 is the new version of Terra Classic blockchain. This version relaunches Luna cryptocurrency. In fact, the new Luna coins replace the old ones. Terra 2.0 is completely different from the old Terra platform, now known as Terra Classic. Now that the network is up and running, the new Terra will be officially released under the original brand. The main difference between these two networks is that it will not be supported by Terraform Labs or Do Kwan (the founder of Terra Classic). This means Terra 2.0 is fully community controlled.

The technical name of this chain is Phoenix-1 and the name of its test network is pisco-1. The previous network will continue to work with a new name; This network will be called Terra Classic chain and all its tokens will have the classic extension. Therefore, Luna will be called Luna Classic or LUNC, and Dollar Tera and other stablecoins of this network will have the suffix C added to their tokens (USTC, KRTC, EUTC, etc.). Some centralized exchanges that have listed the new network and its tokens have used the name LUNA 2 for the new network token and LUNA for the older network currency.

Question:

Beginning in the wee hours of Monday, January 9 (ET), the price of LUNA skyrocketed, from $1.37 to a high of nearly $2 before settling down at roughly $1.60.

Identify some of the major reasons for this recent upshot in price, and back up your assertions with data. Why did the price jump so suddenly on Monday night? Will prices remain at, or above, current marks in the coming weeks or will it return to at or near $1? Why?

Overview of analysis:

In this investigation, we start seeking evidence for LUNA price pump of January 9, 2023. For this purpose, the following parts have been examined carefully:

• Track the price of LUNA price (Daily and hourly)
• Activity of Terra network around that day
• Trading activity of LUNA token

Methodology:

• The data provided by Flipside has been used to handle this analysis. To handle this investigation the following steps have been passed as below:
• Step 1: Price analysis
  • Daily and hourly analysis with average, min and maximum value
• Step 2: Terra network activity
  • Active wallets, New users
  • Transactions
  • Success rate
  • Bot activity
  • Paid fee
• Step 3: Trade
  • Swap and swapper count
  • volume
  • buy or sell LUNA on Monday, January 9
• Step 6: By aggregating the outcomes of the steps and deep dive into the all parts of this live dashboard, draw a conclusion about how activity of Terra blockchain during holidays and new year.

Part 1: Track LUNA price

Part 3: Trade analysis

Findings:

The first part indicates the price investigation on LUNA through daily and hourly time basis:

• According to the outcomes, the average daily price of LUNA did not changed so much on January 9 but from the maximum price aspect it can be easily seen that the maximum price of LUNA on January 9 has been risen tremendously.
• Now lets look deeper into the price of LUNA on Monday, January 9. According to the related chart, the price of LUNA reached over 1.8 USD on 17:00 and it was a sudden jump and after that hour it back to their previous level.
• The aim of this investigation is to find out the reason of that sudden jump and explain it.

Part 2: Network activity and seek to find suspicious pattern

Findings:

To find out the major reasons of sudden price jump for LUNA on Monday January 9, the various aspects of Terra network have been examined and the outcomes are:

• The active wallets on January 9 was higher that other days around that day and it can be considered as clue.
• The count of transactions and newcomers on Terra did not follow the suspicious pattern on January 9. As well as paid fee in LUNA.
• Also, I investigate on the success rate of transactions and bot activity to find out the possible manipulation by bots. But according to results, there is no suspicious bot activity on January 9.
• The most popular contracts on Terra have been determined in daily basis and according to them, the Astroport and Terra Poker are two of the most used contracts on Terra during Monday January 9.

With consideration of these statements lets concentrate on the active wallets on Terra and find out their activity!

Findings:

Decide to look on the trade activity of LUNA on network during past weeks and also concentrated on the Monday, January 9:

• According to the daily analysis, the count of unique swappers for LUNA has been risen in an interesting way.
• Also, the volume of swaps from LUNA was higher than swap To LUNA on that day.
• The most popular swap pair on January 9 was LUNA→ Astroport and LUNA → Terra poker money.

Findings:

Concentrate more on the swap activity of LUNA during Monday January 9 to find related pattern:

• There it is! During January 9, the volume of sold and bought LUNA reveals that on 5PM people bought LUNA more than other times and the net volume of LUNA bought was positive on that time. By implementing the price chart on this content, it can be seen that this trade activity is the responsible for sudden price jump on LUNA token during Monday January 9.

• The count of swaps and unique traders proof the previous statement.

• Now we should find out the result of for this high pressure bought on LUNA during Monday, January 9.

• For this purpose, I decided to investigate on Twitter account of Terra to bring up my hypothesis.

• On January 9, the twitter account of Terra announced the Terra poker is hosting AMA and Also, the new pair LUNA went live on Cosmos!

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Conclusion and Price prediction for LUNA:

As mentioned in the methodology section by aggregating the consequences of the previous parts the following statements have been drawn:

• As we mentioned, the main reason for the sudden jump in price of LUNA is the trade activity related to LUNA token on Terra network on Monday January 9. Also, the psychological impact caused by this behavior and background of Terra, the price dropped from its higher value accordingly.
• Cryptocurrencies are also subject to hacks and future regulations, which may affect their overall value. Also, The U.S. is still in the midst of deciding whether cryptocurrencies are securities, commodities or something else entirely.
• By considering the previous statement and also, the recent increasing trend on crypto universe specially BTC and ETH. It can be said that, the LUNA price could move near 2$ in the next days. Its strongly correlated with the general activity of market as well as nature of blockchain.

Useful links:

• Terra networks
• Docs about Terra. 2
• GitHub about Terra. 2

Author:

Credited by MZG

Discord handle: m.zamani#0361

Twitter handle: @GargariZamani