The $60 billion implosion of the Terra ecosystem last May exposed cracks in the foundations of the crypto industry and kickstarted a year of cascading financial crises that have yet to relent.
Now, in the ashes where Terra once stood, another controversy is bubbling—one offering potential warning signs for the broader crypto landscape.
The matter concerns Terra Classic (LUNC)—the Cosmos-based network born out of the collapsed Terra ecosystem—and Allnodes, a major staking platform currently integral to Terra Classic’s operation.
Terra Classic is often referred to as a “meme chain”—meaning it isn’t taken all that seriously by the wider crypto community. The network was resuscitated by Terra community members more out of a spirit of experimental novelty than an earnest ambition to re-establish the failed behemoth architected by current international fugitive Do Kwon.
Despite that modest ethos, though, Terra Classic is, financially speaking, no laughing matter: LUNC’s market cap currently hovers around $1 billion, and the cryptocurrency routinely clears $100 million in daily trading volume, according to CoinGecko.
Terra Classic is, like an increasing number of blockchains, a proof-of-stake network. Users can deposit LUNC to help validate transactions on Terra Classic; in return, users accrue rewards in the form of newly generated LUNC. And, like with any other proof-of-stake network, those unwilling or unable to set up a Terra Classic validator node themselves can pay a third-party service to handle the technical, cumbersome process.
Though many such third parties once serviced the vibrant Terra staking ecosystem prior to its collapse last May, most major staking services ran for the exits as soon as Terra’s brand turned toxic. Save one.
Allnodes, a Los Angeles-based nodes and staking service, continued to service Terra Classic users during and after the network’s
