The Luna And Terra Debacle, Lessons And Ramifications

Stories about the Luna Terra mess have been analyzed in many dimensions. We cover few related issues that, have for some reason taken a backseat – this report is focused on crypto investors. It is important for investors to make their own assessment, blindly following any report – including this one, is never a good thing.

Glitzkoin has been consistently harping about one fact that, crypto investors today come from all walks of life. A large proportion of investors are not blockchain or crypto experts. Glitzkoin is a good example as, many first time crypto investors have started their crypto journey, by investing in the Glitzkoin GTN token. Gold traders and conventional stock investors, have regularly expressed interest in the token.

There has to be a logical reason for what happened and there is one but, it is hard to believe that, a crypto that was supposed to be flush with value – could crash and dismantle with just one malfunction. The tech team at Glitzkoin has a crystal clear idea of what went wrong but, the explanation would surely not be simple for many Luna investors to understand. There is a lesson here for investors – it says that, buying into complex projects might not be advisable. Not all complicated projects would come down like a pack of cards but, the risk element does rise when, you barely understand the project.

There were quite a few reports where, Luna investors revealed how they lost huge amounts of money – some lost their lifesavings, lost everything. While these occurrences are tragic, investors seem to have ignored one golden rule – this applies to all types of investments and not just to cryptocurrency. You never put all your eggs in one basket meaning that, you should ideally spread investments across various cryptocurrencies. Taking this a step further, you could combine cryptocurrency, gold, stocks and bonds and even property, in your investment portfolio.

Hours after Luna crashed to nothing, Changpeng Zhao the CEO of Binance, the largest crypto exchange – admitted that Binance had lost almost all of its $1.6 billion investment in Luna. If you wish to know the gory details, that $1.6 billion was worth $3,000 the moment the crash happened. Not much that Glitzkoin could advise the Binance boss about, but we are dumbfounded at the size of that investment. Just wondering if Zhao, ever thought about the risk level of Luna. The $1.6 billion loss for the man is not the end of the world but, it is surely something that he would not take lightly.

As we get ready to publish this report, there is a move to find a ‘solution’ to the crisis. In all likelihood this so called ‘solution’ is unlikely to end the nightmare of Luna investors. A major portion of Luna investors, would understand little about the solution and the process involved. Some interesting observations wereexpressed on crypto social media channels. There is a fairly strong feeling that, the solution being put forward – focuses more on avoiding legal scrutiny rather than, on providing a fair degree of relief to affected investors. This is obviously guesswork, facts and details should be out soon.

Talking about crypto legislation, the call for effective crypto laws has been growing louder in recent years. Glitzkoin has taken a clear stand – there is a need for reasonable and fair crypto legislation. The terrible Luna episode will no doubt, raise the bar for crypto legislation. Too early to say, but not very tough to guess the direction in which things will move.

Concluding this report with a quick recap of the bare essentials. Do not invest all or most of your funds in a single crypto – no matter how awesome that might sound. Learn to make your own evaluation, cross check everything that you read, see and hear – that includes information on all Glitzkoin channels and websites. In general avoid projects that, seem too complicated for your understanding. Have a clear understanding that crypto investments are speculative, there will be risks. Making knowledgeable decisions, tracking your investments and having a clear exit strategy – can go a long way in moderating associated risks.

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GLITZKOIN: A quick recap of the Glitzkoin project and the GTN crypto token.  The project was launched to improve the demand for natural diamonds and to enhance, the efficiency and productivity of the multibillion dollar industry.

The DiaEx diamond trading platform was developed using Stellar blockchain resources. The GTN token was launched as part of the project and is designated, as the mode of payment on DiaEx. Promoted by second generation diamond veteran Navneet Goenka, Glitzkoin assigned a multifaceted role to the GTN token. 

The trading platform was completed in 2019 and was put through rigorous testing in early 2020. A team of diamond dealers subsequently did a pilot run on DiaEx with, actual transactions made on the platform.  This process was largely successful and revealed a few areas for improvement. The Glitzkoin tech team was handling the minor adjustment when, the pandemic and subsequent lockdowns slowed down the process. The management will reschedule the full launch of DiaEx once the health crisis eases.

Talking about the multifaceted nature of the GTN token, the project is also focused on further increasing usage for the crypto – this aside from crypto exchange trade and the payment usage on the DiaEx platform. The concept is to have operators of various businesses, accept the GTN token as a mode of payment in their operations. Moving this idea forward Glitzkoin has confirmed a partnership with online ticketing giant Myticket.asia, wherein clients of the ticketing portal could use the GTN token as a mode of payment. Technical requirements for the integration of systems on both sides is at an advanced stage, nearing completion. Reviewing the challenges that the entertainment industry has been going through during the COVID pandemic, both managements have decided to set a launch schedule when the situation starts to normalize. The arrangement setup between Glitzkoin and Myticket.asia will form the blueprint, for similar deals to be negotiated with other business operators.

 

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