Bitcoin is increasingly seen as a store of value

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Bitcoin has always been defined as digital gold, a store of value, decentralized compared to the yellow metal. There has always been a lot of discussion about this concept because Satoshi Nakamoto's goal was to create a decentralized peer to peer payment method, accessible to everyone at any time and from anywhere in the world.

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In reality, we are well aware of the difficulties of the Bitcoin blockchain and the great adoption that has taken place in recent years has not found support from the scalability for which making payments of small amounts is often counterproductive, the fees are higher than the actual amount to be sent. In reality, this aspect of Bitcoin has attracted large public and tried investors, amplifying the power of the cryptocurrency.

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Do Kwon, founder of Terra (LUNA), outlined plans to accumulate $ 10 billion in BTC and thus create "a new monetary era based on standard Bitcoin". Bitcoin thus becomes a store of value for the company in order to ensure that the UST stabelcoin, anchored to the dollar, is also better protected in the future from hypothetical UST sell-offs, endangering the value of UST.

At the moment the peg is controlled by the native token of the Terra blockchain: LUNA. When UST goes above or below 1, LUNA is burned or created to balance the peg. However, this may not be enough in the event of a hypothetical devaluation of LUNA for which in that case there would be Bitcoin as a guarantee. The current objective is therefore to hold 10 billion in BTC as a reserve but this could be a figure destined to increase over time, especially with the appreciation of Bitcoin itself, in addition to the growing popularity of LUNA and UST.

Today there are nearly 16 billion UST, a value that continues to increase day by day. The greater the demand for FSO, the more MOONs will burn. This obviously creates a lot of hype in the crypto community and there are very interesting projections on the value of LUNA over the next few months, as UST's market cap rises. The Earth ecosystem is growing rapidly and this is requiring large quantities of USTs and a reduction in LUNA's supply.

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by crypto@crypto_rudd on Twitter


The projections on the price of LUNA and on the UST marketcap over time are very optimistic, especially if the crypto market continues to experience an average static or bullish phase. The chart shows a pattern that considers over time as the UST market cap rises and BTC as a reserve rise, the price of LUNA may reflect an uptrend.

Bitcoin is therefore now considered a reserve of value in all respects, a guarantee like physical gold, and in the future it will also be able to almost completely replace the yellow metal.

This is not financial advice and readers are advised to undertake their own research or seek professional financial services

Bitcoin is increasingly seen as a store of value | Ecency