What can we learn from Luna’s Token collapse for our cryptocurrency launch?
As is well known, the cryptocurrency market is a fluctuating and in many ways unpredictable environment. Following the collapse of, Luna Tokenthere is much speculation that this could be the beginning of the end for the cryptocurrency market.However, taking for granted that risk is a constant element in cryptocurrency investment, and that despite skepticism, its evolution has always been constant, it is obvious to ensure that this is just a phase, and that for the decentralized finance, market, events such as the Luna collapse are ideal to push the evolution of this financial resource.
Something that the case of Luna Tokendemonstrates is that the construction and success of a cryptocurrency project are fundamentally based on trust, and just like this example, once success is achieved, its permanence is based on the commitment and capacity of the project to face different scenarios. For Luna, the fateful scenario that they never saw coming, consisted in the increase of interest rates by 1%, something that for any StableCoinis very serious, taking into account that its structure is based on the anchorage to a fiat currency.
There are about 200 stablecoins in the world out of approximately 18,000 different fully decentralized cryptocurrencies. Of course, in practical terms, the collapse of luna Token has no structural implications for virtually any other cryptocurrency. Therefore, the only aspect that motivates the current crisis in the cryptocurrency market.is based on the loss of confidence of investors around the world.
After the collapse of the Luna cryptocurrency,major cryptocurrencies such as Ethereum and Bitcoin suffered significant declines in value. Something from which, however, the world’s major cryptocurrencies managed to recover a few days later.
The Luna example is a clear sign that there are still major challenges in the development of blockchain technology and decentralized finance, but also an explicit argument that demonstrates how despite the ongoing skepticism, the power of decentralized finance is even resistant to shocks such as the collapse of Terra luna.
However, this is only a symptomatic phase and, in fact, makes this a highly recommendable moment to invest and organize a new cryptocurrency project.
As has been demonstrated in its history and particularly the current event with Terra/luna , the unexpected turns and eventual crises in the sector, are usually short periods, which serve in many respects, to strengthen and make the crypto economy, an increasingly complex and effective ecosystem.