Bitcoin and Ethereum are now household names. Those who know little else about the crypto world still recognise the two largest cryptocurrencies. But there’s another cryptocurrency that has outperformed them all and you may only be hearing its name for the first time now.
LUNA is the native cryptocurrency on the Terra network and in 2021 was the top-performing cryptocurrency. For those who have never heard about LUNA, it might come as a surprise that it returned more than 14 700% last year.
The era of Terra
Cryptocurrencies are constantly searching for solutions to traditional markets and building on what their predecessors created. With each new addition to the crypto space, more opportunities open up.
Bitcoin was created to be an electronic cash system but instead became a digital version of gold. Ethereum wanted to improve on what Bitcoin could do by offering smart contract functionality on its blockchain. Simply put, smart contracts enabled people to build applications on top of Ethereum. This led to it becoming a $300-billion asset. Solana then improved on what Ethereum offers by making transactions faster with lower costs.
So what is setting LUNA apart and why did it see so much investment in 2021?
Let’s take a closer look.
How is Terra different to competitors?
Firstly, it’s important to understand that Terra is the name of the blockchain network that powers global payments. The Terra Network has a native cryptocurrency token called LUNA. This is the same setup as Ethereum (the blockchain network) and ETH (the network’s native cryptocurrency).
LUNA has grown to become the ninth largest cryptocurrency and offers similar functionality to other smart contract enabled cryptocurrencies, like Ethereum and Solana. What separates LUNA from the rest is that it is an application-specific blockchain.
This means that it was built with a specific purpose in mind: to rebuild the current system of payments into a cheaper, faster and more efficient one. It sounds like a mighty task but Terra is making it happen through the creation and transfer of stablecoins.
Stablecoins are cryptocurrencies pegged to conventional government-backed currencies (i.e. the rand or US dollar) or other traditional assets like gold.
Think of Terra as a mix between a bank (like FNB) and a payments network (like Visa). The Terra blockchain network allows its users to spend, save, trade, or exchange these stablecoins instantly. All of this can be done on the Terra blockchain without the need for any banks or financial intermediaries.
Should I buy Terra’s cryptocurrency LUNA?
When looking at a potential investment, there are three main questions you should be asking yourself before jumping in:
1. What problem is Terra solving?
2. Is Terra seeing adoption?
3. How big is the market it aims to disrupt?
- What problem is Terra solving?
The Terra network is making the global payments system more efficient.
The Terra blockchain can handle over 10 000 transactions per second at near-zero cost, even on weekends. Visa, which processes 1 700 transactions per second, only transacts on weekdays and costs over 100x more.
- Is Terra seeing adoption?
Terra is seeing explosive adoption.
Even though Terra is still relatively new, it has amassed billions of dollars worth of value. Terra’s payment system has two million users and, according to Terra’s website, processes more than $1-billion in transactions each year.
- How big is the market it aims to disrupt?
Stablecoins have opened a multi-trillion-dollar opportunity in the payments space and have seen growth from $5-billion to $170-billion in supply. Terra’s stablecoins could achieve a significantly greater market share by 2025 from less than 8% in 2022.
Where can I buy LUNA?
Cape Town-based crypto investment platform Revix (www.revix.com) will be the first platform in South Africa to offer Terra (LUNA).
Revix’s platform makes crypto investing effortless. Set up only takes a couple of minutes and the easy-to-use platform means you can check in whenever you want, wherever you are.
With Revix, you’re in safe hands. Not only is the FinTech backed by JSE listed Sabvest but they were the first platform in South Africa to perform a proof-of-reserves audit independently verifying that all their customers’ assets are safe and secure.
Revix will be offering LUNA from 25 February 2022 with a fee-free promotion on all investments.
Revix is offering 0% buy-in fees on Terra (LUNA) for one week, starting on 25 February and ending on 3 March 2022.
Through Revix’s online investment platform, you can also easily invest in their ready-made low-cost “crypto Bundles” enabling you to invest in multiple coins at once. This lowers your risk through diversification and makes crypto investing easy. Their crypto Bundles enable you to effortlessly own an equally-weighted basket of the world’s largest and, by default, most successful cryptocurrencies without having to build and manage a diversified crypto portfolio yourself. Their Bundles are similar in nature to diversified ETFs covering indices like the JSE Top 40 or S&P 500 but for crypto.