Luna Classic up 100% and USTC up 300%; Is Terra ecosystem back on track? 

The Terra ecosystem is once again in the spotlight following its infamous crash that was caused by the TerraUSD, or UST stablecoin de pegging crisis in May, which in turn led to an overall slump in crypto markets. 

According to data from CoinMarketCap, Luna Classic [LUNC] had over 100 per cent uptrend while USTC exhibited over 300 per cent increase in the past seven days. This might point towards the fact that Terra ecosystem is on its way to recovery. But is that true? 

This is how Terra Luna Classic performed in the past week. 

And this is how USTC performed in the past month. 

 

Is Terra ecosystem making a comeback? 

It may seem like the Terra ecosystem is making a comeback at first glance. Despite the surge, the value of the cryptocurrency plummeted significantly over the last month. Both the cryptocurrencies dropped by more than 99.99 per cent in the last two months. On the basis of strong technical and fundamental analysis, analysts do not predict a near-term growth in the cryptocurrency's value. 

 

What caused the crash of Terra ecosystem? 

As a result of the algorithmic stablecoin UST (Terra USD) de-pegging fiasco in May of this year, the cryptocurrency plummeted 100 per cent. 

 

Nevertheless, what is the relationship between Luna Classic and UST? 

The adoption of UST, a stablecoin is essential to the development of the Terra ecosystem; hence, the Luna Classic token and UST are inextricably linked. The Luna Classic token gets burned when the demand for UST increases. Alternately, if UST is seen to be volatile, Luna Classic's value declines.