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$185 million worth of LUNA burned in past month as Terra user base grows

Major factors behind growing awareness for Terra's LUNA.

$185 million worth of LUNA burned in past month as Terra user base grows

Cover art/illustration via CryptoSlate

Terraโ€™s native token LUNA rallied 79.66% during the past seven days as the protocol developed by South Korean firm Terraform Labs surpassed Polygon (MATIC), recording the third-highest total value locked (TVL) among blockchains.

LUNA, which is part of an algorithmic balancing system that is used to stabilize the price of the protocolโ€™s stablecoins, traded today at its all-time high (ATH), with the price hitting $33.3.

The exploding ecosystem

The blockchain platform incentivizes trading between LUNA and Terraโ€™s stablecoins when it needs to reduce or increase the stablecoin supply and is currently witnessing a growing awareness as the price of its native token surged more than 460% during the past 30 days.

With $6,21 billion TVL, Terra became the third among blockchains, following Ethereum (ETH) and Binance Smart Chain.

Major exchange listings boosted the Terra user base growth significantly as Wrapped LUNA (WLUNA), an ERC-20 token that’s intended to represent Terra (LUNA) on the Ethereum blockchain and TerraUSD (UST), a native Terra stablecoin pegged to the US Dollar, both became tradable on Coinbase Pro.ย 

Wormhole, Anchor, Columbus-5

The recent launch of Wormhole, a โ€œbridgeโ€ protocol that connects Solana (SOL) and other blockchain networks, including Terra, that is set to facilitate tokenized assets, including non-fungible tokens (NFTs), move seamlessly across chains, started the explosion.

As of recently, Ethereum can be used as collateral on the Anchor protocol, a lending and saving platform in Terraโ€™s ecosystem.

The news of a new gateway for Ethereum users that can interact with Anchor, boosted the protocolโ€™s TVL to $2.7 billion from $1.7 billion in just four days, reflecting demand for TerraUSD, which can be borrowed against bETH, a wrapped version of the stETH staking derivative for Ethereum 2.0.ย ย 

While the demand for TerraUSD grows, more LUNA tokens get burned, driving its price up. But to make it even more intense, in the upcoming weeks, the blockchain platform is due for a network upgrade dubbed โ€œColumbus-5.โ€

Following the anticipated upgrade launch, a plethora of new projects will go live on Terra, with a multitude of applications being released.