Large LUNC Token Burns Reduce Supply

One of the primary drivers of today’s rise is the increase in token burns. According to Luna burn data, about 32 million LUNC tokens were burned today alone, bringing the weekly total burn to over 224.46 million tokens. In total, approximately 85.58 billion LUNC tokens have been burned so far, representing roughly 19% of the total supply. Gradual reduction in circulating supply is viewed positively by investors for long-term value growth. Community-driven burn mechanisms remain one of the key factors in rebuilding trust following the major collapse in 2022.

The surge in LUNC price is not only due to reduced supply but also increased trading activity. In the past 24 hours, LUNC’s trading volume jumped to around $43.33 million. This spike indicates renewed speculative interest and the return of short-term traders to the market. Higher volume and liquidity provide a stronger technical foundation for price movement while keeping volatility elevated.

Jane Street Case Rekindles Terra Discussions

Another important trigger for the recent surge is the SEC investigation into Jane Street. Allegedly, during the TerraUSD (UST) depegging process on May 7, 2022, Jane Street may have used insider information to take positions that accelerated the collapse. The TerraUSD crash wiped about $40 billion from the crypto market and remains one of the largest crises in the sector. Now, ongoing investigations and lawsuits have brought Terra-related discussions back into focus. Some LUNC community members argue that the collapse was not just due to internal system failures but possibly triggered by external market attacks. This narrative has gained traction again on social media, partially improving perceptions of Terra. If claims of external interference gain credibility, some investors might reassess the project.

At the same time, online discussions about Terra founder Do Kwon have increased. Some investors acknowledge mistakes but argue that the event may not have been a planned fraud. This perspective has slightly softened negative sentiment toward Terra Luna Classic, boosting short-term speculative interest.

LUNC Is Still Far From Its All-Time High

Although LUNC has shown strong gains today, it remains far below its historical peak of $117. The current price compared to the all-time high shows a massive gap. The 24% rally in Terra Luna Classic is the result of a combination of increased token burns, a surge in trading volume, and renewed attention from the Jane Street investigation. Analysts caution that such sharp movements carry high volatility, and speculative narratives may only have a temporary effect on the price. LUNC’s future direction will depend on both the sustainability of the burn mechanism and developments in the ongoing legal cases.

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In the court’s statement, it was stated that Kwon’s extradition was approved and the final decision would be given by the Minister of Justice of Montenegro. It was recalled that Kwon was previously sentenced to four months in prison in a Montenegro court on charges of trying to flee to Dubai by private jet using a fake passport. In June 2023, it was revealed that Kwon was charged with trying to leave the country using a fake Costa Rican passport.

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In the court’s announcement, it was emphasized that if the Minister of Justice gives final extradition permission, the extradition would take place after the execution of the sentence given in the fake document case.

Do Kwon was arrested in May 2022 due to his role in the $40 billion collapse of the Terra ecosystem. While it was mentioned that both the US and South Korea requested Kwon’s extradition, the court’s statement said that the Terraform Labs co-founder could be punished in both countries.

In the US, charges awaiting Kwon include accusations by the Department of Justice about the collapse of TerraUSD and LUNA and a lawsuit related to fraud from the Securities and Exchange Commission. It is reported that if extradited to South Korea, Kwon could be sentenced to 40 years in prison.

Last week, information was shared regarding the decision by Montenegro’s highest court to reject Kwon’s appeal and keep him in prison. It is mentioned that Kwon is currently being held in Spuž prison and is allowed to go out for one hour a day, while European officials reportedly stated that prison conditions are cramped and ventilation is inadequate.

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The United States Securities and Exchange Commission (SEC) included a new court file containing these Slack chats, which date back to a period up to September 2019. According to the message report, Kwon and Shin, were actively contemplating tactics aimed at increasing investor interest for Chai Corporation, a Seoul-based payment provider. Kwon and Shin founded The Chai Corporation in mid-2019, and the two companies shared offices and staff until they parted ways in 2020.

In a leaked message, it appears that Kwon is discussing a strategy involving the creation of artificial transactions to boost Chai’s appeal to potential investors. In the conversation, Kwon says, “I can create simulated transactions that look very similar to real transactions.”

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Terra Founder Denies Allegations in Ongoing Legal Dispute

Do Kwon continued explaining that these transactions would generate additional fees, which Chai could gradually remove as it expands and develops.

Kwon also appeared to propose a mutual agreement to keep this plan highly confidential with Shin, saying “I won’t disclose if you don’t.” He emphasized that it would be a tough fight for investors to detect these manipulation tactics.

Later parts of the conversation show Kwon saying, “Those who can prove this is a fabrication deserve all the praise,” expressing his determination to make it extremely difficult for the plan to be revealed: “I will spare no effort to ensure it is almost impossible to reveal.”

Despite the evidence he encountered, Do Kwon vehemently denies any allegations, claiming that the context of the evidence presented is misleading.

Kwon’s legal team argues that the communication between Kwon and Shin primarily focused on the possibility of profiting by cooperating with validators of LUNA tokens, and that the issue of creating fake Chai transactions was not the main agenda item. They state that “The SEC, during a procedural motion unrelated to a court request brought against Mr. Kwon, tried to present the evidence in an effort to weaken the basis of the SEC’s case.”

In addition, Kwon’s legal representatives express concerns about his surrender to the US regarding the collapse of the Terra ecosystem. They argue that this request is “impossible,” stating that Kwon is currently being detained in Montenegro, and that his release date has not yet been determined. These developments point to an ongoing and complex legal dispute and highlight the need for more research to determine the true nature of the allegations and evidence.

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You can access the AMA content and details here.

First, the Ledgity project representatives, whom we asked to introduce themselves, conveyed the following during the Coin Engineer – Ledgity AMA event:

“I am Pierre-Yves, the founder and CEO of Ledgity. I am joined by our CPO and DeFi Leader, @LilaRest. In total, we are an 8-person team based in France, combining over a decade of experience in TradFi and a deep understanding of how new technologies like blockchain and crypto will revolutionize the finance industry. We are very excited to share Ledgity’s vision with the community.”

Our AMA event as Coin Engineer started with some introductory questions we asked the Ledgity project representative and the questions asked and the answers provided were as follows:

Q1: What is Ledgity? Can you briefly introduce it?

A1: We are excited to present the Ledgity Yield Protocol. It’s a treasury management solution backed by Real World Assets, providing stable, reliable, and scalable yield solutions for stablecoin token holders.

Our vision is to develop a “stable yield for stablecoins” solution backed by RWA. This is perfect timing as the RWA market is booming, and it’s likely to play a significant role in the crypto market in the coming years. Wallets with Tokenized RWAs doubled in just a year. In just 2 months, RWA jumped from the 13th to the 8th position in the largest markets on DeFi Llama. Binance predicts the RWA market will be worth $16 trillion by 2030.

It’s the perfect market timing. The TradFi fixed-income market has been offering the best yield opportunities in the last 15 years. Our legal team has been working hard for over a year to be regulated by the French Financial Market Authority as a Digital Asset Service Provider. With one of the most advanced regulations for crypto assets worldwide, Ledgity Yield Protocol follows a similar approach to Lido for liquid Ethereum staking: users deposit USDC, receive LUSDC, and start earning yields in LUSDC. They can withdraw LUSDC to USDC whenever they want.

LUSDC is backed 1:1 by a diversified bond portfolio.

Q2: What is the current stage of the project?

A2: We successfully launched our Beta on Arbitrum and Linea just 2 weeks ago. Our technical and financial architecture is ready, and it’s time to spread the word and pave the way for a bright future for Ledgity Yield . We are forming partnerships with major projects and launching an intensive marketing campaign.

Soon, we will kickstart our Arbitrum Lockdrop, rewarding early adopters with the first $LDY tokens! Let’s replicate Lido’s success, but this time for stablecoin yield.

Q3: We’ll come back to the Lockdrop campaign shortly, for now, can you explain how the protocol works?

A3: From a regulatory perspective, i) users lend their stablecoins to Ledgity. ii) Ledgity swaps the USDC into fiat currency, secures the capital in a segregated bank account, and iii) invests the capital into a diversified bond portfolio. Also by pooling stablecoin capital together, Ledgity’s yield program allows stablecoin holders to benefit from a stablecoin yield solution with an institutional governance approach.

Funds are invested without a speculative spirit, and the investment rules align with the core objective of providing stable and attractive yields offered in the stablecoin. From a technical perspective, Ledgity’s financial team leverages Off/On ramps with partners like Circle to securely move funds to an off-chain RWA portfolio.

The Ledgity Yield application offers a series of smart contracts that act as a bridge between DeFi and TradFi, securing the flow of funds between users and Off/ramp partners, from reward distributions to deposit and withdrawal operations. When a user deposits USDC into the Ledgity Yield smart contracts, they receive LUSDC as proof of deposit in a 1:1 ratio.

Once a user holds some LUSDC, they start generating a yield on it. There’s no need to stake, lock, or claim anything; the user will see their LUSDC balance growing automatically over time. Shortly, users will be able to use their LUSDC as collateral on lending platforms, as liquidity on DEXs, and even in an auto-leverage vault to enhance their yields!

Q4: I heard that you will be sharing 13% of the 6-month supply through a Lockdrop campaign. I’m excited to get exposure to such an advanced RWA project! Can you provide more information about the campaign?

A4: The campaign will kick off on Arbitrum. So stay tuned, the official date will be announced soon. Additionally, participants of the Lockdrop will be the first to receive $LDY tokens. This is the only way to start receiving $LDY tokens from TGE. Other wallets will have no choice but to buy on the market (= no selling pressure at launch). TGE is expected to be completed by the end of October.

Locking will only be open for 30 days and will distribute approximately 13% of the 6-month $LDY supply. Users can lock any amount of USDC for 3, 6, or 12 months. The longer the lock, the more $LDY a user will receive. Please note that the Lockdrop will be limited to the first 5M USDC, and it’s first-come, first-served, so don’t miss out on the opportunity! Lastly, it’s worth mentioning that Lockdrop participants will earn $LDY only for 6 months, with the majority of other emissions occurring over 48 months!

Get notified when the locking process begins by joining our Discord: https://discord.gg/ledgityyield

Q5: Great, but can you provide us with more information about the $LDY Token?

A5: Great question. $LDY is the utility and governance token of the Ledgity ecosystem. $LDY resides at the heart of the ecosystem and offers many benefits and advantages to $LDY token holders, such as unlocking the leverage vault, 0% withdrawal fees, and extra yield on stablecoins through features like L-Boost.

It’s important to note that this is a community-centric token and will primarily be distributed as an incentive to our community members. 5% of protocol revenues accumulate in stablecoins to support the token price by buying back $LDY tokens during bearish periods. Inflation increases, decreasing over the years until reaching the maximum supply (4 years).

After the questions posed by the Coin Engineer within the scope of the project were answered by the Ledgity representative, questions from 10 Twitter and Telegram users were selected during the Coin Engineer – Ledgity AMA event and were subsequently addressed by the Ledgity representative in the Coin Engineer – Ledgity AMA.

TWITTER QUESTIONS

Q1: You allow users to lend and borrow cryptocurrencies at fixed rates. How does this compare to traditional finance? (@ErmanlarSelim)

A1: Hey @ErmanlarSelim, thanks for your question. We don’t allow users to borrow. We offer a yield protocol on a stablecoin with an attractive yield backed by RWA to benefit from its stability. So in a way, we’re multiplying what you have in tradfi when you invest cash in an investment solution like a bond portfolio, but for the web3 industry. The stablecoin market is currently massive, with around 120 billion dollars. It’s somewhat similar to what Lido Finance does but for stablecoins.

Q2: The founders of Ledgity have experience in the financial sector and believe in the future of cryptocurrencies. What forms the basis of this belief? (@Atakan_Yaavuz)

A2: The best use case for blockchain technology is in the finance industry. This is because the finance industry deals with ledger management, and blockchain technology disruptively innovates ledger management. When you understand how the banking system works, you can easily identify the benefits of using blockchain technology.

So, crypto and blockchain will definitively reshape our financial infrastructure, bringing greater efficiency, faster settlement times, and reduced intermediary costs. We are at the forefront of this innovation, and the Ledgity Yield Protocol is a great example.

The best way to see this in action is by joining our Discord: https://discord.gg/ledgityyield

Q3: Your platform will be fully usable by the end of 2023. What does this mean for users? What can we expect? (@atar_abdullahh)

A3: Dear community, there’s a lot in store for you. First and foremost, the upcoming Arbitrum Lockdrop campaign will distribute the first $LDY tokens to our earliest community members. After that, we’re preparing leverage vaults and L-Boosts that will allow you to further boost stablecoin yields, integrated with other protocol opportunities. But most importantly, our incentive campaigns!

We aim to distribute 65% of the $LDY supply to our community over the next 4 years! This will be in the form of enhanced vaults, $LDY staking, incentives, and more. The best part is that these rewards will be distributed linearly over 4 years, so the earlier you join, the less you’ll share these rewards with other users.

Q4: As a team, do you analyze your competitors and chart your course accordingly? How much contribution will locking USDC make? (@HknylmzHakann)

A4: We continually conduct competitor analyses. It’s an ongoing process to provide our community with a unique value proposition and to continue being one of the most competitive protocols in our space. By locking your USDC, also you’ll receive a portion of the first $LDY tokens. And after the lock period, you get your USDC back 100%! Lock-drop participants will be the first to receive $LDY tokens. This is the only way to start receiving $LDY tokens from TGE. Other wallets will have no choice but to buy on the market (= no selling pressure at launch). TGE is expected to be completed by the end of October.

Q5: An exciting project for the future of cryptocurrencies. How do you envision this project playing a role in the use of cryptocurrencies? (@ZaferYellow4)

A5: For a long time, stablecoins have served as a haven in the crypto space amidst volatility and for intermediary value transfers. However, until now, the yield offered on stablecoins has mostly been volatile, requiring users to constantly readjust their positions. The first role Ledgity Yield will play is to provide stablecoin holders with a real and stable yield.

The yield on stablecoin is like an interest-bearing current account. It’s essential for the democratization of stablecoin usage in a healthy DeFi ecosystem and international value transfer. We can identify significant demand for stable yield in stablecoins from DAOs, Foundations, VCs, and more.

Thank you. Don’t forget to join us on Discord (https://discord.gg/ledgityyield) to help us build a leading protocol for yield on stablecoins. Also, mention that community members can participate in Zealy’s “Ledgity Game” campaign to win NFTs and much more.

TELEGRAM QUESTIONS

Q1: I think Legity Yield will be very beneficial for DeFi users. How can I invest in your project? Can you provide information about your token sale process and early investment opportunities?

A1: There won’t be any token sale (ICO, etc.), the only LDY tokens in existence will be those distributed through the DEX liquidity pool (300k $LDY tokens) and via the Arbitrum Lockdrop campaign. The selling pressure will be very low, so our Lockdrop campaign will be quite interesting for our early community members. So, the only way to get exposed to the growth of Ledgity Yield is actually to put some USDC into the Lockdrop campaign. But it’s limited to 5M USDC, so be quick! Join our Discord server to get notified when the Lockdrop starts https://discord.gg/ledgityyield

Q2: I’d like to know the benefits of holding $LTY tokens as a long-term investment. How will demand for $LTY tokens increase in the future? What steps are you taking to increase demand? Can you tell me how you plan to attract more partnerships to your project?

A2: I think this is one of the most important questions. The RWA portfolio backing the Ledgity Yield protocol consists of 4 buckets:

• 5% remains in stablecoins to provide instant withdrawal capability for users.
• 30% is allocated to short-term US Treasury bonds.
• 30% in short-term investment-grade and high-yield bonds.

Q3: Terra, also known as Luna coin, had the highest market cap project recently due to its high APR rates, and its collapse caused a revolution in the crypto market (in a bad way). What measures are you taking to avoid bad outcomes when adjusting these APR rates for stablecoins? (@serdarsst)

A3: That’s a good question. Terra Luna had a completely different mechanism, relying solely on the value of Luna Tokens, which was highly volatile. The Ledgity Yield protocol, on the other hand, provides a secure yield solution on stablecoins primarily because it relies on real-world assets. Bonds have been around for decades in TradFi. They represent the most significant asset class, representing trillions of dollars in the financial sector. For example, if you invest in bonds issued by the U.S. government, you can be assured of receiving your yield and capital. We are applying the same corporate standards as asset managers and investment funds in TradFi.

Q4: How exactly do L-Tokens function as “yield-bearing” tokens and what technical mechanisms allow them to earn yields without the need for traditional DeFi processes like staking or locking? (@tolgaozek)

A4: Hey, that’s a nice question about our innovative reward distribution system! In essence, LUSDC rewards are claimed right before someone is about to use them (in the same transaction). It’s a completely transparent process for users who think they don’t have to claim anything. It also eliminates the need for rebase mechanisms and allows for advanced functionalities like redirecting rewards. For example, enabling a DAO to redirect its rewards to another DAO, a parent redirecting rewards to their children’s wallets, etc.

Q5: Ledgity Yield platform, what risk management policies do you use to protect the stablecoins and loans provided by investors? (@zanioloricardo)

A5: We implement strict risk management policies regarding the management of the protocol treasury. The RWA portfolio backing the Ledgity Yield protocol consists of 4 buckets:

• 5% remains in stablecoins to provide instant withdrawal capability for users.
• 30% is allocated to short-term US Treasury bonds.
• 30% in short-term investment-grade and high-yield bonds.
• 30% in U.S. factoring. We also work with leading partners with a long history in TradFi. We monitor daily: default risk, liquidity risk, and rate risk. We can leverage over a decade of experience in fixed-income fund management.

Q6: You’ve launched Ledgity Yield on Arbitrum. Are you planning to implement Ledgity Yield on other ecosystems like BSC, ETH, and Polygon? (Erick || Community Manager (CM))

A6: We aim to cover as many stablecoin holders as possible. So yes, we do plan to expand the protocol to other networks (Hedera and Avalanche are planned) and as many stablecoins as possible. Currently, we support USDC on both Linea and Arbitrum, but we plan to support many more stablecoins in the future. EUROC stablecoin is next in line.

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