The Terra Luna Classic price has plummeted to $0.00016791, with its 4.5% drop today following the news that the SEC is charging Terraform Labs and CEO Do Kwon “with orchestrating a multi-billion dollar crypto asset securities fraud.” LUNC remains up by 4.5% in the past week, but is down by 4% in the last 30 days, amid a turbulent time for the market as a whole.
The recent SEC charges against Terraform Labs and Do Kwon haven’t impacted LUNC directly, as the coin is now community-driven. In fact, LUNC’s sister stablecoin USTC is being re-pegged, which could mean a brighter future for LUNC than the newer LUNA token, which was launched by Terraform Labs as part of the revamped Terra 2.0 network.
LUNC’s indicators have responded negatively to yesterday’s news, with the coin’s relative strength index (purple) dropping from 70 a few days ago to just under 30 today. This indicates that the price is likely to continue falling, as the coin becomes oversold.
Likewise, LUNC’s 30-day moving average (red) has stalled after looking like it might be climbing back toward its 200-day average (blue). The possibility of a further dip before bottoming out is looking increasingly likely.
The key short-term support level to watch is $0.000165, which could signal further falls if it fails. With Terraform Labs, Do Kwon and Terra, in general, entering the news for all the wrong reasons now, the negative publicity could indeed cause LUNC to drop further.
The SEC has not released information on what type of punishment or penalty it is seeking against Terraform Labs and Do Kwon, but the charges levied against them have been damning.
The SEC has filed a complaint against the team behind Terraform, alleging that the ecosystem was a fraud propped up by a so-called algorithmic ‘stablecoin’ – the price of which was controlled by the defendants, not any code. Gurbir S. Grewal, Director of the SEC’s Division of Enforcement, had this to say: “As alleged in our complaint, the Terraform ecosystem was neither decentralized, nor finance. It was simply a fraud.”