But is it too late,
or is there still time to get in on this project?
Every top ten crypto has seen a decrease in price recently
except for one: LUNA.
The Terra protocol's native token has been on fire.
And to get in on this excitement, I've decided to run
a crypto trading bot on LUNA
to see how this token holds up.
So here I am on Pionex.
I'm going to use their grid trading bot to put $1,000 on LUNA.
I'm going to let the AI set the trading parameters
just to keep things simple here.
And there we go.
I'm going to report the results later on in this video.
Now, let me give you a short background on Terra.
Terra is among the first blockchain networks with
purely algorithmic stablecoins built for ecommerce.
It's kind of like an automated Federal Reserve.
So picture a robot version of Jerome Powell.
Robot Jerome is preprogrammed to execute
specific actions to control and influence prices.
If Robot Jerome detects that there isn't enough
currency, he automatically fixes the problem.
Now, you might be wondering, how is this
different from most other stablecoins?
Well, Terra stablecoins rely on a
two-token seigniorage model,
and this is just a big brain way of saying that
prices are stabilized by controlling the
supply of coins in the circulation.
When the coin price is above the peg,
the supply is increased and when the price is
below the peg, the supply is decreased.
Terra offers many different stablecoins,
but UST is the biggest, both in market cap
and total value locked with a market cap of $9 billion.
To mint UST or any other Terra stablecoin,
an equivalent amount of LUNA must be burned.
UST is getting more and more popular
for a few major reasons.
First, you can earn nearly 20% APY on this token
through the Anchor protocol.
And second, people are getting
pretty sick of Tether's shenanigans.
- Boo!
- Tether, the largest stablecoin in the world, has been
surrounded in controversy for years,
as well as concerns that they don't have
complete assets to back their stablecoin.
Tera is more decentralized than Tether,
as there's no central entity that has to
prove that they have backing.
It's run in part by smart contracts.
This gives UST a unique value proposition
for those who are sick of trusting humans
to do the right thing.
Even though there is Terraform Labs,
the company behind Terra,
the founder of Terra, has agreed to completely
abolish Terraform Labs if regulators do come after them,
and this would make it fully decentralized.
As far as I can tell, this would make
UST untouchable to regulators,
and this would live up to being
a true decentralized stablecoin.
Just don't try and call customer service
because there won't be any.
Hi, yeah, I'd like to check the status of my UST deposit.
- We're sorry you have reached a number that has
been disconnected or is no longer in service.
- Jokes aside, there are some risks to decentralization.
There are incentives for burning Terra
and UST to keep that price pegged right at $1,
but if they don't work, UST could be thrown off its peg.
This actually happened back in May when a
ton of people were swapping stablecoins to LUNA,
and at the same time, the value of LUNA was slipping
as people were selling during the crash.
This is bad.
Nothing will panic a trader
more than seeing their stablecoin
at less than $1.
- Oh, my God! Okay, it's happening.
- Everybody stay calm.
- What's the procedure?
- Stay *** calm!
This led Terra to introduce Proposition 90,
as well as a whole bunch of other additional updates
which will help solve this issue.
The Columbus-5 update happened in September.
Every time LUNA was burned to mint UST
in the past, a small portion of profit went to a
community pool to fund new projects on Terra.
The first upgrade did away with this,
and now 100% of LUNA will be burned
when it's minted for UST.
This helps make LUNA a more deflationary token,
meaning there will be more upwards
price pressure on the token.
Then we have version 2.1 of Ozone Insurance,
which is basically a safety net for those who hold UST
just in case it falls off its peg.
After that, was the release of Stargate.
Stargate opened up the interoperability floodgates
for UST and other Terra assets,
which basically means that Terra can more
easily be used across different blockchains.
This helps to attract far more users.
Stargate also increased Terra's
transactions per second throughput
by somewhere in the neighborhood of 10 to 30X.
Finally, with Columbus-5, there was significant
staking yield increases as well, up to 79%.
So the goal here was to increase the amount of LUNA staked
and the demand for the LUNA token,
which seems to be working given the recent price movement.
But Terra's overarching goal is to be a
global payments and ecommerce platform.
So here are some of the programs running
on the Terra blockchain at this moment.
This is important because
Mirror is a DeFi protocol powered by smart contracts
that enables the creation of synthetic assets called Mirror assets.
So, for instance, you can see these popular stocks
are mirrored to their actual share price.
And this is a fascinating use case for crypto,
especially for those who might have trading restrictions
in the country that they live in
and they want to buy a stock.
They can simply buy these mirrored assets
without any permission from a central authority.
I do wonder how this will pan out in the legal arena, though.
And on top of this, we have the Anchor protocol,
which I mentioned earlier, earns around 20% yield on UST.
That's roughly 400 times more
than what you earn in your average bank savings account.
Anchor protocol has been on a massive rise
in total value locked and is currently at $10.6 billion,
which is double from where it was at the beginning of October.
CHAI is a payment platform which is powered by Terra's Blockchain.
This makes perfect sense considering that it was
founded by Daniel Shin, who is one of LUNA's two co-founders.
CHAI is currently available on TMON,
which is an ecommerce platform with 10 million users.
CHAI creates and manages a Terra wallet
for the customer behind the scenes.
The front end interface doesn't actually
provide crypto information, making it as
seamless as using something like PayPal.
The fee for merchants is considerably lower than using a
credit or debit card at a processing rate of 0.05%
rather than the normal 2-3%.
This app really feels like the future of blockchain tech.
I think for true crypto adoption to happen,
people need to be able to use it
without knowing that they're using crypto.
A customer shouldn't have to know what a hashrate is or
what Byzantine Fault Tolerance is,
in order to buy something with crypto.
It's no different than the Internet.
You can be on YouTube smashing that subscribe button
as you should, without needing to know JavaScript.
This all makes me bullish on the Terra ecosystem,
which in turn can only help the LUNA token.
Now let's take a look at some other events
contributing to LUNA's upwards price performance.
Terra has passed a couple of proposals
to burn $4.5 billion worth of LUNA from community pools.
The burn will occur every 800 blocks produced.
When the vote happened, initially
89 million tokens were burned and the price of LUNA rose
instantly from $50 to $54.
This is one of the largest burns of Layer-1 assets
in crypto market history.
Also with the release of Columbus-5, there was
hundreds of dApps waiting for the upgrade
before launching and upgrades now happen.
This includes the release of an AMM decentralized exchange called
Astroport, and this is big.
Astroport launched on December 14
with an incentive for users to lock up
their LUNA to be airdropped ASTRO tokens.
According to DeFi Llama, Astroport currently has
$1.28 billion in total value locked,
more than 50% of that consists of LUNA.
And then we have NFTs.
The Terra Ecosystem launched their first NFT collection
so you can see that there is a lot
going on in the world of Terra LUNA
and a lot to be excited about.
But is LUNA a good buy now,
or did we miss the boat?
I think LUNA is destined to continue upwards in the long run.
However, I plan to be really careful
not to go all in at near all-time highs.
I think patience is the key to winning the game of crypto.
So let's say you have $1,000 to invest in LUNA.
Maybe consider investing $100 a week for 10 weeks,
instead of $1,000 all at once
in order to help reduce that volatility risk.
Of course, that's not financial advice, but
How high can Terra go from here?
Well, I'm not a fan of direct price predictions.
I've seen on Twitter a $1,000 price prediction
for LUNA, meaning it would more than 10X
compete in size with Ethereum.
Given how unique the ecosystem is with not only
being a layer-1 blockchain but also being
a global ecommerce platform,
I could see this potentially happening at
some point in the future, but I would never bank
on that kind of price action in the short run.
If this is the Ethereum killer,
it will take time.
And the bot results are in, we've been running this bot
on LUNA for 24 hours now on Pionex
and let's check out the results.
We are currently up 1.35%
and it looks like this was actually as high as about 3%,
and this is in comparison to LUNA only being up
0.5% for the last day.
So we actually made more profit on this bot
than LUNA made in the last 24 hours.
Pretty awesome.
I'll have Pionex linked in the description,
if you want to mess around with some bots on your own.
So there you have it, everything you need to know about Terra.
From here, I recommend checking out the link in the description
for iTrust.
With iTrustCapital, you can actually place your crypto
in a Roth retirement account.
This means you can buy, sell, and trade
to your heart's content and pay no capital gains on your wins.
This is amazing for traders.
With a Roth, you pay your tax upfront
when putting the money in the account
and then at retirement, you pay no tax
once you start pulling out at age 59 and a half.
This is probably the most simple way
to save on all capital gains.
I'll have the link in the description and if
you use that link, you'll receive $100 in free Bitcoin
just for joining.
And that's going to do it for today.
I would like to thank you so much for watching
and I hope you have a profitable day!