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The cryptocurrency markets continue to experience significant fluctuations, drawing attention to the latest developments surrounding Terra Luna Classic (LUNC). Following the sentencing of Do Kwon, a notable decline in LUNC’s price occurred, which reignited discussions about the project’s ecosystem. Nevertheless, the token remains a standout asset in the market by maintaining a strong performance compared to its lowest point earlier in the month.
The Impact of Do Kwon’s Sentence on LUNC
Terra Luna Classic recently plummeted to $0.00004587, marking its lowest value since December 5th. Despite this downturn, LUNC is trading approximately 85% above its monthly low, ranking among the best-performing tokens of the week. However, the decline did not stop with LUNC, as similar tokens like Terra and USTC also faced multi-million-dollar losses in value.
One of the primary reasons behind this sharp price movement is the 15-year prison sentence handed to Terra’s founder, Do Kwon. This decision exceeded both the defense’s request for five years and the prosecutors’ proposal for 12 years. The court cited the investors’ losses exceeding $40 billion due to the collapse of the Terra ecosystem as a fundamental reason for the ruling. Terra’s collapse in 2022 triggered a significant chain reaction affecting not only LUNC and UST but the entire crypto market . This process is often cited as a contributing factor to the acceleration of the FTX crisis the same year.
Technical Analysis and Community Dynamics
Technically, the daily charts reveal a swift rise in LUNC from its low of $0.00002488 on December 1st to $0.00008055 on December 6th. This surge occurred due to expectation-driven purchases before Do Kwon’s sentencing announcement. Afterward, investors reacted with a “sell the news” strategy, reducing positions and pushing the price below the critical support level of $0.000047. This level also garners attention as the neckline of a double top formation.
Analysts view the current outlook as indicative of continued short-term pressure. The next strong support is the month’s low of $0.00002488. However, the presence of an active community, ongoing governance votes, and Binance ‘s monthly token burns suggest that long-term hopes are far from extinguished. Meanwhile, in a different sector development, the increasing staking demand on the Ethereum $3,093.86 network and a shift toward Layer-2 projects indicate a gradual redirection of investor interest toward alternative ecosystems.
