It seems to be another day in Terra land. The firm is coping with misleading chat history, forged documents claims and whatnot! In this dark backdrop, Terra Classic’s (LUNC) price has taken a toll, currently trading below its moving averages and 52-week highs. This downturn follows a shocking revelation: prominent crypto figure Do Kwon admitted to manipulating trading volume.
The expose came through a series of text messages between Kwon and Chai founder Daniel Chin. Kwon suggested creating fake transactions to generate fees, with Chin expressing reservations. This revelation emerged amid a U.S. government shutdown and a brewing controversy surrounding leaked chats.
Will SEC react to this, before that let’s understand what’s happening with Terra.
Leaked Chat Controversy Stirs!
While the SEC is suing Terraform Labs, alleging that it misled investors about the stability of its TerraUSD stablecoin. This leaked chat history cannot be ignored.
Caught under the radar, Chai, which had initially partnered with Terra to expedite payment processes, has now become central to allegations of fraud by the U.S. SEC. In response, the SEC said that Terra failed to deliver on promises made to users, failing to replace Chai’s payment systems with its own blockchain. This development is particularly noteworthy given that Chai’s founder Daniel Shin was a co-founder of Terraform along with Kwon in 2018.
Heaps of Legal Cases Making Terra Suffocated
Terra, once a prominent DeFi blockchain, faced a severe downturn in May 2022, leading to a bear market and a string of affiliated projects declaring bankruptcy. Do Kwon has since been hit with a series of charges from American and South Korean authorities. He was arrested in Montenegro earlier this year on charges of document forgery and remains indefinitely detained while contesting his extradition to the U.S. The uncertain future of LUNC raises questions about its viability in the crypto market.
Is it All Over for LUNC?
Terra’s downfall had negatively impacted the crypto market, causing financial distress for projects associated with the ecosystem. Currently, LUNC is trading at $0.000063181, slightly below its 100-day moving average of $0.000074160. In contrast, Terra Classic is trading above its 52-week low at $0.000055776 but below its 52-week high at $0.000361281. However, LUNC’s trading volume in the last 24 hours is lower than its seven-day average, with 20,556,576.26 tokens exchanged. The numbers are not good and legal cases like fraud may tamper investor sentiments.
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