South Korean crypto project achieving adoption

SEOUL: In a space where so many projects have over-promised and under-delivered, a blockchain start-up in South Korea looks set to achieve what has eluded many cryptocurrencies in the past: mainstream adoption. 

Created by Terraform Labs, Terra Luna is built on some very complex and technical concepts, but at a basic level, can be quite easily explained.  

The project offers ‘stablecoins’ that are pegged to traditional currencies – including the US dollar, Euro and Korean won – and can be transacted or even deposited into a virtual bank for high-interest returns.  

Its token, Luna, acts as the reserve currency of the platform, ensuring the price stability of the Terra stable coins algorithmically.  

The design is such that the more the stablecoins are used, the more value that accrues to the Luna token.  

Who is behind Terra Luna?

The founder’s name is Do Kwon. He’s not yet 30 years old, but he’s confident, he’s ambitious, and above all, he’s incredibly smart.  

A computer science graduate from Stanford University, he was the founder and CEO of a decentralized mesh network known as ‘Anyfi’ and has worked as a software engineer at Microsoft and Apple. 

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Who is using Terra Luna?

A payments platform known as ‘Chai’ is allowing around 2.2 million users to transact the Korean Won stablecoin (KRT) with thousands of merchants, including Nike Korea. 

Most of the consumers would not even know they’re using blockchain technology, nor do they need to know.  

Billionaire Mike Novogratz, an investor in Luna, says it was Terra’s proven use case that drew him to the project. 

“What’s great about Terra is they are one of the first sandbox experiments that’s getting outside of the sandbox,” Novogratz told Bloomberg. 

“We are always looking at those projects because they are the canaries in the coal mines of what else is going to happen.” 

“We are always looking at those projects because they are the canaries in the coal mines of what else is going to happen.” 

Mike Novogratz

More recently, the LUNA stablecoins have been used beyond payments, with the creation of new Terraform Labs projects.  

Mirror Protocol (MIR)

‘Mirror Protocol’ allows users to trade ‘Mirrored’ assets, such as stocks, precious metals.  

A recent governance vote passed a proposal that will see mirrored Coinbase shares traded on the platform immediately after its initial public offering (IPO).   

At the time of publication, the protocol had US$1.84B worth of total value locked (TVL). 

Anchor Protocol (ANC) 

The most recent addition to Terra’s stable of products, Anchor allows a way for Terra stablecoin holders to earn rewards.  

It can essentially replace a savings account, which offers a 20% return on stablecoin deposits. 

What’s next? 

There appears to be many projects in the pipeline for Terra, with suggestions one will allow the decentralized trading of Exchange Traded Funds (ETFs). 

In a recent interview, Do Kwon revealed he has been in touch with the Bank of Korea, which is interested in using blockchain for its own purposes. 

“I think right now more of their interest is academic and research based,” he said. 

“The BOK (Bank of Korea) also has CBDC (Central Bank Digital Currency) plans, so they’re trying to understand what is the potential … and things are about to get interesting in Korea.”