Why did USTC surge? Understand the logic behind it in one article

1. The information gap behind the surge

It is not the community proposal that is circulated outside. That proposal has not yet entered the voting stage and is just a discussion on the forum. The core reason is more likely that the new project Mint Cashwemintcash and the new version of Anchor Protocol Sail OnAnchor that the Anchor team members are about to participate in

2. What is Mint Cash?

A BTC-collateralized stablecoin system based on the original Terra Classic codebase.

3. What is the connection between Celestia+Nomic+Anchor in the picture circulated on the Internet?

Mint Cash is an IBC chain derived from Terra Classic, so Celestia should be used in the DA layer, and Nomic's nBTC will be used for the issuance of stablecoins. A new version of the Anchor Protocol named Anchor Sail SailOnAnchor will be released in Mint Cash.

The new version of Anchor Sail plays a very important role in Mint Cash and plays a key role in the growth and anchoring of stablecoins.

4. Who are the team members?

The core developers come from the former Anchor team, as well as Aleph Research, whose developers are also planning to build Polaris EVM support based on the Cosmos SDK with CosmWasm and Berachain.

5. Mint Cash will be cold-launched via $USTC in 2 ways.

(i) Hold $UST or $LUNA before the crash on May 10, 2022 (ii) Lock and destroy a specified amount of $USTC through the Mint Cash airdrop. The airdrop algorithm here does not disclose the detailed calculation method, but the current statement is that USTC will be calculated at a valuation of 1 US dollar, which is also one of the market's fomo points.

6. What are the rewards?

This issue should be what the market is most concerned about. Currently, the circulation of $USTC is 9 billion. Many people use this number to directly push the valuation of new projects to nearly 10 billion. But it is obvious that not all of these circulating $USTC will go into new projects. A reasonable state may be 1/3 or 1/2. That is, based on 1 US dollar, the valuation of the new project is between 3 billion and 4.5 billion. The FDV of LUNA 2.0 is currently 800 million US dollars. You can calculate your own price based on 1 US dollar.

If we calculate it based on 0.014 before the pull-up, it is about 40M-60M. According to the current market feedback, the market believes that this valuation is low and the odds are high. Of course, there is another question here, which is your expectations of the new team. After all, this is a project with only a white paper. If you are a rational investor, you should get to know the team more deeply and read the white paper. But if you are an old Degen, you will probably like it very much.

7. Market reaction

It took 3-4 days or even less than a week from the concept of Celestia+Nomic+Anchor to the pull of $USTC. In the past few days, the price of the currency did not even fluctuate at all. In addition, the liquidity of USTC is very good. It is not the kind of depth that can be pulled up by hundreds of thousands or millions. Last night, the trading volume of Binance alone exceeded 100 million, and it is still growing today.

In addition, the goal of Mint Cash is not to pull $USTC back to 1, but to launch new projects. Simply put, your valuation expectations for new projects determine the current price expectations of $USTC.