Terra (LUNA-USD), the number seven cryptocurrency by market capitalization, is in focus today after reaching a new all-time high. LUNA crypto hit $104.58 per coin this morning, its highest value since reaching $103 back in December. Now, Terra price predictions are everywhere as investors consider jumping into one of the few major cryptos breaking records lately.
What do you need to know about Terra?
Well, fans of LUNA crypto are surely in good spirits today after Terra skyrocketed more than 20%. While the coin is currently trending up 16%, reaching a new all-time high is always a strong sign for a cryptocurrency. For Terra, today’s jump is likely related to its sister token called TerraUSD (UST-USD), a stablecoin tied to the U.S. dollar.
UST and LUNA share an interesting relationship. When the value of UST drops below $1, holders of the stablecoin can exchange UST for $1 of LUNA. What’s happening today is the opposite, however. When demand for UST pushes it past $1, investors can opt to create more UST by burning the equivalent amount of LUNA, effectively lowering the price of TerraUSD. However, burning LUNA also drives the price of the crypto up as a consequence of lower supply. As demand for UST surged today, more LUNA crypto was burned, pushing its value up dramatically.
This morning, the Luna Foundation Guard (LFG) tweeted that its council voted to burn the 4.2 million LUNA token left in its treasury.
Due to such a high demand for $ust , the curve pool is unbalanced again…
— LFG | Luna Foundation Guard (@LFG_org) March 9, 2022
Investors clearly had reason to jump on LUNA given the strong upwards pricing pressure placed on it. So, with that said, let’s see what the experts think about Terra’s potential going forward.
Terra Price Predictions
Wallet Investor believes Terra is an excellent option in the near and long terms. It set a one-year forecast of $165.88 as well as a five-year price target of $508.27 for strong growth across the board.
CryptoNewsZ is more bearish on Terra. They believe the LUNA crypto will trend around $70 this year and between $78 and $85 through 2023. Given the coin is currently trading for $99, this assumes it will fall fairly dramatically going forward.
Finally, Coin Price Forecast is unabashedly bullish on Terra. It predicts Terra will hit $151 by the middle of this year and more than $200 by the end of 2023. Long-term, the site also believes LUNA will reach more than $300 in 2025. That’s more than triple its current price.
On the date of publication, Shrey Dua did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.