Terra Luna Classic (LUNC) surges 90% in 24 hours: Causes and latest developments

In the past 24 hours, Terra Luna Classic (LUNC) has recorded an explosive increase of over 90% at the time of writing, extending its winning streak into the second consecutive session. This strong breakout has also quickly propelled LUNC to the second spot in CoinMarketCap’s trending tokens list.

LUNC’s price surge is believed to stem from renewed market interest in the upcoming verdict related to founder Do Kwon, which is expected to be announced on December 11.

Notably, even though Do Kwon has pleaded guilty in the fraud case linked to the collapse of the Terra ecosystem—a piece of news that would normally put negative pressure on price—the market has reacted in a completely opposite direction.

Despite a series of unfavorable news, LUNC has continued to accelerate sharply, surprising investors and raising many questions about the real driving forces behind this sudden spike.

Short Position Liquidations Fuel the Rally

In addition to the psychological boost from discussions around Do Kwon, a wave of mass short position liquidations has become a significant catalyst pushing LUNC’s rally higher.

At the time of reporting, LUNC was the trading pair with the largest short liquidation value in the market, surpassing even leading coins Ethereum (ETH) and Bitcoin (BTC).

Data from CoinGlass shows that in just one hour, the total value of liquidated positions on LUNC pairs exceeded $1.47 million and soared to $5.19 million within a 12-hour window.

This scale accounts for around 10% of the total short liquidation value market-wide, a figure that indicates an extremely strong “short squeeze.”

Source: CoinGlass Notably, LUNA—the token issued by Do Kwon after abandoning LUNC—has also started to reappear on charts, though the level of activity is still incomparable to LUNC.

However, the fact that LUNA continues to attract some capital flows from LUNC suggests that the current rally may be more sustainable than previous recoveries.

LUNC Token Burn Activity Surges

Besides price movements, on-chain metrics—especially supply reduction efforts—are showing clear effectiveness. The total amount of tokens burned this week has exploded, surpassing 427 billion LUNC. In the past 24 hours alone, an additional 84.164 million LUNC have been removed from circulation, after recording about 691.625 million LUNC burned the previous day.

Notably, December 1 and December 5 are the two days with the highest number of tokens burned this month, each surpassing 600 million units. Terraform Labs continues to play a key role in this activity, accounting for about 58% of the total tokens burned. The combination of positive on-chain signals and the wave of short liquidations has provided significant momentum for the price reaction.

Source: LUNC Burn Tracker The question is whether the technical uptrend is strong enough to sustain the recovery, or if developments from the upcoming verdict in Do Kwon’s case will completely reverse the market situation.

Can LUNC Maintain Its Uptrend?

On the 4-hour chart, LUNC has just broken above the downtrend channel, ending a sideways phase that lasted more than a month before the breakout on December 2. The bulls’ strength is evident in the large green MACD histogram bars, while the Cumulative Volume Delta (CVD) indicator records over $41 million in favor of buyers and is still rising.

In the past two days, LUNC’s price has surged more than 157%, from $0.00002739 to $0.00007088, but selling pressure started to appear as the price neared its July peak. To maintain the rally, the bulls must continue to overpower the bears—a strength previously shown during the recovery after the prolonged decline since late February.

Source: TradingView However, the fact that the price has only just broken the downtrend structure may limit short-term upside potential, as the market could still be affected by resistance from the prior downtrend zone.

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