Terra founder Do Kwon recently placed a $1 million bet with a merchant on Twitter that the price of LUNA, the native token on the Terra blockchain, will remain above $88 for a year from now. kwon responded to a challenge published by @AlgodTrading.
The two parties then went on to make their bet with @cobie, co-founder of the crypto podcast UpOnlyTV, who confirmed receiving the $2 million in Tether. On March 14, 2023, @cobie will transfer the full amount to the winning party.
Kwon and Algod agreed to consider LUNA’s 24-hour average trading price to settle the bet. The token is currently trading at $93.8, just below the lifetime highs.
Algod has repeatedly made the blockchain a “ponzi scheme”, stating that dollar-pegged Terra stablecoin (UST) will not survive a sharp sell-off in the LUNA ecosystem. Their challenge is an extension of this position.
Algod also received offers from other merchants for their challenge, although it was not immediately clear whether the money had changed hands.
LUNA benefits from high yield offered by Terra
The LUNA token has been tearing up, soaring as much as 50% in the past month and nearing an all-time high of over $100. Buying the token was driven by demand for the relatively high yields offered by deposits in Terra-based stablecoins.
In particular, the Anchor Protocol (ANC), which is based on the Terra blockchain, offers a near 20% market-leading return on UST deposits. LUNA can be used to spawn on the platform and can also be burned to produce UST, at a ratio of $1 from LUNA to $1 from UST.
Recent market volatility, triggered by the conflict between Russia and Ukraine, has increased the demand for stablecoins, leading traders to seek UST exposure through LUNA. The Terra community has also been active in supporting UST and recently launched a $1 Billion Bitcoin Reserve to maintain the return of nearly 20% offered by ANC.
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About the author
With over five years of experience in global financial markets, Ambar plans to leverage this knowledge for the fast-growing world of crypto and DeFi. His main interest lies in finding out how geopolitical developments could affect crypto markets and what that could mean for your bitcoin holdings. When he’s not scouring the internet for the latest news, you can play him video games or watch Seinfeld reruns. You can reach him at [email protected]
This post Terra founder bets $1M on LUNA price to stay above $88 through next year
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