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Terra is attracting much of the DeFi market

LUNA’s 50% rise in the last week has made it one of the most popular cryptocurrencies. At $34 billion, Terra (LUNA) is currently ranked 7th on Coinmarketcap and moreover the headlines are making themselves known with this rise to fame. The token has not only overtaken Solana ($32 billion) but also Cardano ($31 billion), who are in 8th and 9th, respectively, now that their rankings have changed due to the LUNA hype.

LUNA is the token that powers the DeFi ecosystem. However, the real product is stablecoins, like UST, which peg their value to the dollar. It also protects against cryptocurrency price volatility, keeping your capital safe from fluctuations.

Related Reading | Terra (LUNA) outperforms popular Cryptos Ether, Dogecoin in the last 24 hours

The UST and LUNA markets are in a tug of war. The two stablecoins compete with each other for investors’ attention, but also affect each other’s prices. When dollar-based Terra gains more traction than its crypto counterpart, there is likely to be a rally on both sides due to its unique algorithmic mechanisms, which motivate market players (arbitrage opportunities)

There are many stablecoins, but UST is the only one with decentralization. The market capitalization of $13 billion makes it the fourth largest stablecoin. All the other big hitters are focused. Tether with a market cap of $79bn, followed by $53bn and Circles’ BUSD ($18bn)

The latest data from DefiLlama shows that 11.2% of all funds locked in the DeFi space belong to Earth nodes alone. Quite an impressive number considering its value at $23 billion, compared to other platforms like Solana or Fantom that have less than half the funding. Ethereum still rules supreme; they claim 55% of the domain when they include the total invested.

Terra (LUNA) Price Update

LUNA has been one of the most exciting coins to watch in recent months. However, since January, its price action has diverged from what most investors would expect in a highly correlated market like cryptocurrency trading.

LUNA is currently trading down 0.6% at $91.6 | Source: LUNA/USD chart at Tradingview.com

LUNA is trading at $92.55, with a 24-hour high near $96.31 and a low of $89.21. With a market capitalization of $34.5 billion, the coin ranks seventh in the cryptocurrency market. However, if it were fully diluted, the market capitalization could reach $72 billion, which would be an incredible return on investment for anyone currently investing.

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LUNA is one of the most resilient coins in this cryptocurrency market, and according to Matt Hougan of Bitwise Asset Management, it has had an “absolutely spectacular run” thus far. It fell less than others during the recent volatility, while also recovering faster.

The price of LUNA is increasing rapidly. According to some analysts, it could reach $98 by the end of this month.

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