Following yesterday’s Columbus-5 network upgrade, the price of LUNA, the Terra blockchain’s utility token, increased by nearly 10%.
According to Nomics, LUNA is currently priced at $37.28 at the time of publication, a 9.69 percent increase over the previous 24 hours. Its upward trend has seen it rise by more than 17% in the last month; however, the cryptocurrency has yet to recover from last month’s all-time high of more than $44.
Terra burns and mints LUNA in order to keep its algorithmic stablecoin TerraUSD pegged to the US dollar (UST).
Terra underwent a number of significant changes as a result of the Columbus-5 upgrade. The most notable difference is that LUNA is no longer transferred to a community pool after burning, but is instead burned permanently.
The upgrade also allows Terra to further integrate with the Cosmos ecosystem through the use of its Inter-Blockchain Communication (IBC) protocol, known as Stargate. As a result, Terra is now accessible to a diverse set of decentralized apps (dapps) built with Cosmos and already integrated with IBC.
“Once the network is ready to unlock the gates of interoperability for UST and other Terra assets,” the official Terra account tweeted yesterday, “a governance vote to manually initiate IBC on Terra will be published.”
11/ Once the network is ready to unleash the gates of interoperability for UST and other Terra assets, a governance vote to manually initiate IBC on Terra will be published.
More updates about the plans for the IBC governance proposal will be released soon.
— Terra (UST) 🌍 Powered by LUNA 🌕 (@terra_money) September 30, 2021
Columbus-5 also distributes swap fees earned from Terra Station wallet app trades to proof-of-stake validators and those who have delegated their LUNA to them, increasing the yields paid out.
Finally, the upgrade paves the way for the upcoming Wormhole bridge to the Solana network, which will allow UST to be used in the Solana ecosystem.
The network’s official Twitter account described the upgrade as a “momentous step,” and it hasn’t caused any problems in the short term.