What’s Moving: Terra (CRYPTO: LUNA) traded 1.77% higher at $45.64 on Thursday. The coin has seen an increase in value of 19.15% over a seven-day period.
Why Is It Moving: Terra is surging amid continued interest in light of the Columbus-5 network upgrade going live earlier this month. The upgrade is said to better enable Terra’s native stablecoin TerraUSD (CRYPTO: UST) to maintain its 1:1 ratio with the U.S. dollar.
See Also: How To Buy Terra (LUNA)
Terra uses a dual system wherein when the price of the UST falls below $1, its secondary utility token, Luna, is used to supplement its value to help maintain its value.
According to Forbes, the key benefit of the upgrade is that rather than sending burned Luna back into the community pool, the Columbus-5 upgrade now destroys the used Luna completely thus regulating its supply.
Terra adopting the Inter-Blockchain Communication (IBC) with the upgrade enables the token to unlock its potential by integrating it with Cosmos ecosystem and DeFi, Messari analyst Ryan Watkins noted in a conversation with CoinDesk, dubbing Columbus-5 a “big upgrade for Terra.”
Terra has been on a massive rally this year, surging 6922% as of press time, as per CoinMarketCap data. Many watchers expressed concerns that the market had already priced for the Columbus-5 upgrade in August, but the latest rally is fueling investor confidence, CoinDesk noted.