USTC price surges, new stablecoin project sparks market discussion

Recently, the price of USTC has seen a significant increase, mainly due to the anticipation of the new stablecoin project Mint Cash airdrop. This project and its underlying team have attracted considerable attention from the market.

Reasons Behind the Surge

The main reason for the increase in USTC prices is likely a new project called Mint Cash and the upcoming launch of the new version of Anchor Protocol. This is unrelated to the previously circulated community proposal, which is still at the forum discussion stage.

Mint Cash Project Introduction

Mint Cash is a stablecoin system collateralized by BTC, developed based on the original codebase of Terra Classic. As an IBC chain originating from Terra Classic, its data availability layer may utilize Celestia, and the issuance of the stablecoin may involve Nomic's nBTC. In addition, Mint Cash will also launch a new version of the Anchor Protocol, named Anchor Sail, which plays a crucial role throughout the system.

Project Team Background

The core developers of the project come from the former Anchor team and Aleph Research. It is worth mentioning that team members also plan to collaborate with other projects to jointly build Polaris EVM support based on Cosmos SDK.

Launch Strategy of Mint Cash

The Mint Cash plan will be cold-started in two ways:

1. Targeting users who held UST or LUNA before the crash on May 10, 2022.
2. Participate in the airdrop by locking and burning a specified amount of USTC.

Although the specific airdrop algorithm has not been made public, market rumors suggest that USTC will be calculated at a valuation of 1 dollar, which has become an important factor for market optimism.

Potential Return Analysis

The current circulation of USTC is 9 billion, but it is expected that only one-third to one-half will enter new projects. Based on a valuation of 1 dollar, the new project's valuation could be between 3 billion and 4.5 billion dollars. In contrast, the fully diluted valuation of LUNA 2.0 is currently around 800 million dollars. Investors can discount the valuation of 1 dollar based on their expectations.

If calculated at a price of $0.014 before the increase, the valuation is estimated to be between $40 million and $60 million. Market reactions indicate that this valuation is considered low and has a high potential return.

Market Reaction

The increase in USTC prices from the related concepts took 3-4 days, or even close to a week. The liquidity of USTC is quite sufficient, with daily trading volume surpassing 100 million and continuing to grow.

It is worth noting that the goal of Mint Cash is not to bring USTC back to $1, but to launch new projects. Therefore, investors' valuation expectations for new projects directly influence the current price expectations for USTC.

For rational investors, it is crucial to have a deep understanding of the team's background and the project whitepaper. For investors with a higher risk appetite, such high-risk, high-reward projects may be more attractive.