cryptocurrency

Terra Classic up over 55% in a day: Will LUNC bounce back again? | Mint – Mint


However, it’s difficult to predict whether the recent upswing is a temporary craze or it will contribute to brighter days for its investors.

The Terra Classic price on Wednesday is $0.000142 USD with a 24-hour trading volume of $1,001,400,194 USD. Terra Classic is up 55.56% in the last 24 hours. The current market cap is of $933,764,064 USD, according to CoinMarketCap. 

The token has a circulating supply of 6,554,906,175,581 LUNC coins.

On the surface, it may appear that Terra’s Luna Classic is making a comeback. However, the crypto crashed to the abyss in May. The price of the cryptocurrency fell by over 99.99%.

Terra, a once-$40 billion digital asset ecosystem, crumbled last month in what may have marked the largest token collapse in crypto history.

UST, once the largest algorithmic stablecoin, and its twin token LUNA, which was supposed to stabilise UST’s price, spiralled almost to zero within a week. 

Before the collapse, both UST and LUNA were among the top 10 cryptocurrencies. The Terra blockchain needed to be halted twice during the crisis.

As countless crypto investors lost their life savings in the demise, developers who worked on Terra-related projects found their livelihoods in jeopardy, and other blockchains, such as Polygon and Kadena, were courting those devs with multimillion-dollar funds.

One part of the community decided to stay and focus on how to revive the project, with Do Kwon, the founder of Terra blockchain developer firm Terraform Labs, spearheading the attempt.

As a result, now there are two Terra blockchains operating in parallel:

– The old (original) Terra network with the token renamed to luna classic (LUNC) and UST tokens.

– A newly launched blockchain with a native token called luna (LUNA).

Terra investors in India face the taxman

As India’s tax system is punitive to crypto investing, TerraUSD and Luna token holders who got the new coin – known as Luna 2.0 – in a so-called airdrop face a double whammy. 

They could be taxed as much as 30% of the value of tokens received and they won’t be able to offset any gains in the new token against losses from the previous one, tax experts said.

Under the new crypto tax regime, effective April 1, any income from the “transfer” of a “virtual digital asset” will be taxed at a flat rate of 30%. It does not explicitly mention how airdrops should be taxed, but Jay Sayta, a technology and gaming lawyer, and Manhar Garegrat, executive director of policy at crypto exchange CoinDCX, said the distributions can be seen as income and are subject to the tax.

“The wordings in the law are so vague, including the definition of virtual digital asset and the definition of transfer, that it would be open to litigation of challenge by the tax department,” said Sayta. “They normally consider the most aggressive view possible with a view to collecting higher taxes, notwithstanding the fact that such a view may result in absurdity.”

There were over 160,000 investors that held Luna on the exchange on 9 May and by 15 May the number grew by 77% in India, according to Rajagopal Menon, vice president at Binance-owned WazirX. It’s unclear how many more investors held TerraUSD.

“The increase can be attributed to a surge in buyers post 9th May where the buyer-to-seller ratio was 5:1. In terms of the volumes, 11th and 12th May saw the highest volumes in Luna – 53 million USDT combined for both days,” Menon wrote in an email.

Anoush Bhasin, founder of crypto asset tax advisory firm Quagmire Consulting, said that the Luna 2.0 airdrops may fit into the existing definition of gifts so a flat 30% tax may not apply but gifts are taxed based on a taxpayer’s income range, or slab rate.

With agency inputs

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