New LUNA drops 80%, spooking community

Terra launched its new blockchain and performed the promised airdrop of the new LUNA token, but not everything went according to plan.

Whales in the sky above a solitary boat

On Saturday, LUNA traded for as much as $19.54, but hours later it fell to lows of $3.63, dropping 80%. After a slight rebound, it got stuck at around $6. At press time, it was trading at $6.47.

Price of new LUNA fell sharply over the weekend
Source: CoinMarketCap

In the runup to the launch of Terra 2.0, critics of Do Kwon’s proposal warned that the new blockchain and airdrop were designed to provide exit liquidity for investors to recoup some of their losses. As the crypto world watched the new LUNA nosedive, they were quick to drive their point home.

The dynamic price action on Terra’s new token comes as Binance prepares to list LUNA/USDT and LUNA/BUSD trading pairs. Trading is expected to start on Tuesday.

Initially, Binance CEO Changpeng Zhao was critical of the way Terra team handled the crisis, but eventually, the exchange chose to support the Terra 2.0 blockchain and the LUNA airdrop. Still, Binance’s support is far from enthusiastic. LUNA trading will be restricted to Binance’s Innovation Zone, which lists “new tokens that may have increased volatility and pose a higher risk” than others, according to a statement released on Saturday. To trade in the Innovation Zone, users need to read Terms of Use and complete a questionnaire, which makes the asset slightly less accessible.

Read also: Do Kwon net worth: how rich is the fugitive crypto founder?

Earlier, Binance tweeted that users might see their LUNA Classic (LUNC) tokens disappear from their wallets, assuring that it’s a temporary solution required by the mechanics of the airdrop.

Trading has already begun on KuCoin, Huobi, OKX, and Kraken, among other exchanges. At press time, Kraken’s LUNA/USD trading pair was the only one with a liquidity score above 500 (with 1000 being the highest possible value) according to CoinMarketCap.