When two cryptocurrencies crashed roughly three weeks ago, the effects were devastating. Their collapse sparked over $500 billion in losses in the broader crypto market. Numerous investors saw their life savings evaporate. Others contemplated suicide. People called for criminal investigations into the company behind it all and government regulation for the larger market.
But now the team behind the failed coins are back at it. On Saturday, Terraform Labs, the start-up behind TerraUSD and its sister cryptocurrency Luna, which both dropped to nearly zero in value, started trading a new digital coin that is part of their revival strategy, referred to as Luna 2.0.
“A chance to rise up anew from the ashes,” Do Kwon, founder of Terraform Labs, wrote in his plans announcing the new cryptocurrency.
The coin replaces the old Luna cryptocurrency and trades under its ticker symbol, LUNA. Investors who lost money in Terraform Labs’ previous coins may get some new tokens free, based on a ratio determined by the company. The old Luna coin can still be traded, but under a new name, called Luna Classic. It’s listed as LUNC on crypto exchanges.
The new Luna coin has gotten off to a rocky start, tumbling over 75 percent in value during its first hours, and regaining some of it in subsequent days. As of Tuesday evening, the coin was trading at just above $8.50 — or roughly half the price it started at, according to Coin Gecko, a website that tracks cryptocurrency prices.
But amid its ups and downs, the release has drawn fierce scrutiny from cryptocurrency analysts, investors and critics. It highlights a broader issue with the cryptocurrency market, they said: Companies can sell what they want with little worry about regulation or enforcement — putting everyday investors most at risk.