Terra (LUNA) Investors Should Consider These Risks: CNBC

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Vladislav Sopov

Amid the splendid execution of the Terra (LUNA) blockchain, the CNBC Make It project indicates the main risks that could be associated with the token


CNBC’s educational platform CNBC Make It released a lengthy explanatory read to discuss the potential pros and cons of Terra (LUNA) that enthusiasts should consider while holding the token.

LUNA performance could be affected by UST traceability reliability and regulatory issues

In his interview with CNBC’s Taylor Locke, Matt Hougan, chief investment officer at Bitwise Asset Management, mentioned two main groups of risks associated with buying and holding Terra (LUNA), a core native asset of the high-yielding blockchain platform of Terra.

First, Terra’s stablecoin UST should maintain its 1: 1 parity with the price of the US dollar. As LUNA tokens are used in UST mechanisms, the performance of the two assets can affect each other.

Then potential investors should also consider regulatory issues with stablecoins. The CNBC speaker recalled that Terra’s company, Terraform, is now being investigated by the United States Securities and Exchange Commission.

The watchdog’s investigation is related to Terraform’s Mirror Protocol, which is a platform for synthetic assets. The SEC filed an action against Terraform to find out if it is selling unregistered securities.

Is Terra the new Ethereum?

As previously covered by U.Today, Terra and its token, LUNA, are in the spotlight in Q4 2021. LUNA recently broke the $ 100 mark and soared to the top 10 assets by market capitalization.

Yesterday, Galaxy Digital CEO and seasoned Bitcoin (BTC) advocate Mike Novogratz recommended that CNBC replace Litecoin (LTC) with LUNA and SOL on its slate board.

Both platforms fascinate you with their great community-driven activity and the interest that the dApps developers have shown in building on top of Terra and Solana.

Source: https://u.today/terra-luna-investors-should-consider-these-risks-cnbc

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