TerraClassicUSD (USTC) gained 300% in a week as plans for a bitcoin-backed rollover scheme and a perpetual contract listing on Binance sparked a speculative frenzy.
USTC and LUNC sustain the Terra ecosystem, which collapsed last May.
TerraClassicUSD (USTC) and its sister token Terra luna classic (LUNC), remnants of the disintegrated Terra blockchain, soared this week, boosted by a new listing of Binance perpetual contracts and the emergence of a renewal plan and bitcoin-focused airdrop.
LUNC is up about 60% this week, including a nearly 20% increase in the last 24 hours, CoinDesk data shows. Meanwhile, USTC has almost quadrupled in price. For perspective, the USTC rally has only brought the price to $0.05 from its original fixed price of $1.
The gains came as Binance, which remains the world’s largest crypto exchange despite its regulatory issues, on Monday began offering perpetual contracts for USTC with up to 50x leverage.
Growing anticipation of a USTC renewal plan that would use bitcoin (BTC) as a foundation perhaps also fueled the rally. Bitcoin-focused payments project Mint Cash recently outlined a vision for a successor to the failed Terra stablecoin, this time collateralized by BTC to mint tokens.
The developer team also revealed a few days ago that they are working on an airdrop plan for USTC and LUNC holders.
The recent events sparked a speculative frenzy around the token. Trading volume with the USTC has skyrocketed in recent days, sometimes peaking above $1 billion in 24-hour activity, eclipsing the average of less than $10 million earlier this month, according to show CoinGecko data.
Remains of Terra
Terra luna classic (LUNC) and USTC are remnants of the sister tokens that underpinned the once huge and failed Terra ecosystem, developed by Terraform Labs and led by co-founder Do Kwon, who was arrested earlier this year. USTC was an algorithmic stablecoin, while LUNC, then called LUNA, was used to balance the stablecoin with a peg of $1. The design proved unsustainable and the tokens fell into a hyperinflationary death spiral last May, collapsing the entire multibillion-dollar Terra ecosystem in spectacular fashion.
Read more: A timeline of the meteoric rise and fall of UST and LUNA
In February, the U.S. Securities and Exchange Commission (SEC) charged Terraform Labs and Kwon with “orchestrating a multibillion-dollar cryptoasset securities fraud involving an algorithmic stablecoin.” Kwon was arrested in Montenegro on forged passports in March and last week a local court approved his extradition to the United States or South Korea.
Shortly after the crash, the developers implemented a new version of the Terra blockchain with a new native token called LUNA, so they renamed the old blockchain to Terra Classic and the tokens to LUNC and USTC.
Some developers, however, remained committed to reviving the ecosystem around Terra Classic. The community voted to stop minting (creating) new USTC tokens to help reduce their hyperinflated supply through token burning schemes.
