It took just seven days for the Terra (LUNA) ecosystem to crash as prices plummeted from $85 on May 5th to nearly $0 on May 12th. As the market began to gain clarity as to what was happening, LUNA’s trading volume rebounded sharply from over 200% over the weekend.
In the wake of the UST de-pegging that crashed the LUNA market, LUNA investors mirrored the price drop when CoinGecko saw trading volume fall to $178.6 million on May 13 — a number last seen in February was recorded in 2021.
Declining trading volume of LUNA. Source: CoinGecko
Terraform Labs CEO and co-founder Do Kwon sought damage control the same day when he proposed a revival plan for Terra’s comeback, which would include compensating UST and LUNA holders for holding the tokens during the crash.
Despite the risks involved, Terra’s “insane volatility” is still an attractive market for many short-term investors — largely due to the fact that LUNA temporarily gained 600% in value on May 14.
(You just need a few more 100x to get back to $1)
— Lukas Martin (@VentureCoinist) May 14, 2022
As investors try to recoup their losses while others seek to capitalize on Terra’s comeback, LUNA’s trading volume surged over 200% back to $6 billion. Before the crash, the LUNA ecosystem averaged over $2 billion in trading volume over the past two years.
Comeback of LUNA trading volume. Source: CoinGecko
However, just as LUNA prices fell between the morning of May 10 and May 13, trading volume surged as investors attempted to cut their losses — from $5 billion to $16 billion. At its peak, LUNA’s trading volume hit an all-time high of $16.15 billion on May 11.
All-time high trading volume of Terra (LUNA). Source: CoinGecko
Due to the various factors mentioned above, LUNA has regained its trading volume and is trading at $0.00025 at the time of writing. According to data from CoinMarketCap, crypto exchange Binance accounts for 68.26% of LUNA’s trading volume, followed by KuCoin at 9.52% and FTX at 1.13%.
Related: Crypto.com unblocks users, reverses errant LUNA trades that made 30-40x
On Friday, Crypto.com users raised concerns about LUNA trades being reversed on the exchange’s mobile app.
Crypto.com CEO Kris Marszalek later revealed that an internal bug caused the system to display incorrect prices, resulting in numerous investors raking in profits of 30 to 40 times.
There were many customers who bought at the wrong price and some, of course, also took the opportunity to make the most of the glitch.
We reversed ALL trades.
Some customers saved a lot of $ and thank us, others didn’t abuse the mistake and thrash us.
— Kris | Crypto.com (@kris) May 13, 2022
As a result, Crypto.com temporarily banned all users from trading. After a day of reviewing the supposed system bug, Marszalek announced that “all user accounts have been reactivated.”
As Cointelegraph reported, the company has offered its $10 in-house token Cronos (CRO) as a goodwill gesture to affected investors.