What is Col-5 that makes the community optimistic when it comes to Terra (LUNA) despite a 3 week delay?
The network upgrade is set to change a host of new protocols, drive Terra stablecoin adoption, and further strengthen LUNA demand.
The growing awareness for Terra’s LUNA token is largely driven by the debates and publicity surrounding the network’s critical upgrade, Col-5, originally scheduled for September 9. .
Terra recently announced that the Col-5 mainnet rollout will be delayed delay for about three weeks while reassuring the impatient community that there is “no reason to fret”.
Why is Col-5 implementation attractive?
This upgrade will enable the Inter Blockchain Communication protocol to communicate with Cosmos and other blockchains.
But while cross-chain bridges will allow Terra to export its stablecoins to other platforms, rapidly expanding their use cases, LUNA will also be profitable in a number of ways.
The LUNA swapped with Terra’s native stablecoin UST would be burned, instead of being sent to a community pool as it currently is, which in theory would add further downward pressure on its supply, while also reducing increase in value.
“As retail investors return to the market in search of a more legit investment, they will be easily identifiable by LUNA’s story. More USTs used = less supply of LUNA = rising prices. I’m not sure any other Layer-1 has such a simple story for retail investors to grasp.”
Also, like crypto researcher Westie, who focuses on the Terra ecosystem, has shown on Twitter, after Col-5 launches, swap fees will be given to LUNA stakingers and these fees are expected to increase.
As the adoption of UST increases and more and more LUNA is burned, its value will increase and the staking reward will increase to that size, making it attractive for people to stake their LUNA.
Demand for Terra’s stablecoins, such as UST, is driven by utility and use of products within Terra’s ecosystem, but with over 60 apps set to launch after the Col-upgrade 5, UST adoption could explode.
“The first reason for the parabolic growth has to do with UST adoption, as every 1 UST requires $1 of LUNA to be bought and burned. With Col-5 there are many different projects with the aim of using as many USTs as possible.”
Many of these new entrants to the ecosystem could become game changers.
Mars Protocol, Terra’s first currency market, will have decentralized borrowing. Nexus Protocol will bring LTV protection to Terra’s high-yield saving protocol Anchor and the Mirror aggregated asset transaction protocol. Protocol Talis is set to launch an NFT marketplace on Terra and eventually, Ozone, a mutual insurance protocol, will enable hedging against technical failures, making the entire ecosystem more secure. .
Earlier today, Terra announced on Twitter that the mainnet rollout of Columbus-5 will be delayed until the end of the month.
1/ The Columbus-5 mainnet deployment will be delayed ~3 weeks until a new block height of 4,724,000, roughly equivalent to the following times:
9/29 at 20:30 PST
9/30 at 03:30 UTC
9/30 at 12:30 KST
— Terra (UST) Powered by LUNA (@terra_money) September 1, 2021
- 9/29 at 20:30 PST
- 30/9 at 03:30 UTC
- September 30 at 12:30 KST”
“No need to worry, as the goal is to take some extra precautions with the rollout of Terra’s most important mainnet upgrade to ensure the smoothest possible launch,” the announcement said. of Terra said.
The team added that the downtime will be used to ensure compatibility between Col-4 and Col-5, while providing “more space for third-party projects to build on.” on Terra with dependencies on existing apps like Mirror, Anchor, TerraSwap and Shuttle” that all need to be migrated.
Finally, during the delay, the team said they will “more thoroughly and extensively provide the specifics of the Col-5 upgrade and how to properly use it to the community and developers alike.” third party development”.
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According to Cryptoslate
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