1. Update details (Network Upgrade)
Version: The update is numbered v2.18.
Important clarification: This update is technically dedicated to the Terra (LUNA) network (the new network) and not directly to the Terra Classic (LUNC) network.
Role of platforms: Binance and other platforms have announced their support for this update, meaning they will temporarily halt deposits and withdrawals of LUNA during the update period to ensure network stability.
2. Why does the price of LUNC rise then?
Although the update pertains to the other currency (LUNA), the price of LUNC has been positively affected for several reasons:
Psychological correlation: Investors and speculators often associate the two currencies; when there is positive news or a technical update for one, the other moves accordingly.
Liquidity expectation: A halt in withdrawals and deposits sometimes creates a state of temporary "supply scarcity" or anticipation, driving speculators to buy before the event.
Burn news: The timing of this news coincided with massive burn news for LUNC (which we mentioned earlier), creating a double wave of optimism.
3. The expected impact on the price
Before the event (now): We are currently witnessing a phase of "buying on the rumor," where the price is rising and trading volumes are sharply increasing.
During/after the event: Markets often experience a phenomenon known as "Sell the news," where a correction or drop in price may occur after the update is completed and deposits and withdrawals resume, especially if the current rise is based on a mix between the two currencies.
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