Crypto 2022 Preview: Why Terra (LUNA) Might Outperform

Crypto 2022 preview: Why Terra (LUNA) may outperform - terra ath col5Volatility in the cryptocurrency segment is rampant and will likely continue to be. However, there are some tokens intended to create stability in the crypto space. In this article, Eric Bleeker and Chris MacDonald discuss why Terra (quotation crypto: LUNA) could be an intriguing token to consider in this regard.

What does Eric Bleeker think

Let's deal with Terra with the LUNA token, priced at approximately $ 56,30 at the time of writing, and a market cap of $ 21 billion. Bull case: An increasing number of applications have been built on its blockchain, and what to look out for is increased developer interest and user adoption.

The most notable projects today are in DeFi, but Metaverse and other applications are under construction. Bear case: by 2022 there would be the potential for a lack of application momentum. It is complex. Terra is not an easy project to manage, and this is because previous Stablecoins, which is an aspect of Terra, have failed and it is likely that in 2022 we will continue to fail.

What does Chris MacDonald expect for next year?

I think it's a great introduction, because Terra is certainly very difficult to understand. The description that I think is widely understood is that it is a decentralized and stable suite of algorithmic coins that support a thriving ecosystem, bringing DeFi to the masses. A nice bite.

What Terra has actually done with LUNA, just to simplify a bit, is a quasi-reserve currency for the Stablecoins held inside Terra's stables. What Terra LUNA has been doing is basically trying to ensure the stability of Stablecoin prices by minting and burning LUNA and incentivizing users to keep the price of its Stablecoin constant and pegged to the US dollar primarily.

Future prospects

This means that Terra and its LUNA token really act like a fiat currency, and one of the biggest problems many people have with cryptocurrencies is that it's really hard to pay someone with something that could go up or down 10% on any given day. You would like to know that there will be some stability with your currency date you are about to transact with for transactions that are on an ongoing basis over time.

For a realistic medium of exchange, Terra has come up with this algorithmic way of stabilizing its currency. I think there will be more demand for this in the future.

As you said, there are a lot of DeFi projects that are choosing this platform to build on for a variety of reasons. There's that growth aspect with use cases. There is a real utility being created in the DeFi world. And I think there's a lot of inherent use in having a really stable coin right now, and that's one of the reasons I've looked a little deeper into Earth recently.

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