Do Kwon, the struggling Terra Luna network’s inventor outlined his new intentions to resuscitate the fragile blockchain on May 17. He began by stating that Terra is more than simply UST, the dollar-pegged stable coin that crashed earlier this week.
Many people were opposed to his original idea, which entailed transferring LUNA tokens and abandoning the UST stable coin. This has sparked a second proposal, which likewise involves forking or separating the current blockchain, but with several distinctions.
Making a New Beginning.
On May 18, Terraform Labs will present a new governance proposal to split the current blockchain. It entails forking a new chain that is devoid of the algorithmic stable coin. The previous chain would be Terra Classic with the Luna Classic (LUNC) token, while the new chain would be Terra with the LUNA token.
The new LUNA tokens will be distributed to Luna Classic stakeholders, residual UST holders, and Terra network developers from the prior version.
A significant chunk of the token distribution will go toward “creating an emergency runway for current Terra app developers” and “aligning developer interests with the ecosystem’s long-term viability.”
No Profits Ecosystem.
At the time of launch on May 27, one billion new Luna tokens will be generated and distributed, with a quarter going to the community pool managed by staked governance and the other quarter going to UST holders.
A “pre-attack” snapshot from right before the system failed on May 7 will be used to distribute 35% to LUNA stakes, and 10% to LUNA holders. The remaining funds will be distributed to ecosystem developers.
Does Kwon state that opposing interests made reaching an agreement difficult? Diverse stakeholder interests, including LUNA and UST holders, as well as Terra builders, make it “very difficult and improbable to obtain agreement on a unified, congruent strategy,” he said, before adding:
The current ecosystem is based on the supply and demand concept, with LUNA being created and destroyed to redeem UST. This works great while there is demand and prices are rising, but the system eventually collapsed due to a major liquidation from Defi protocols that offered enormous profits on stable coin staking.
Price Changes for UST and LUNA.
LUNA, which was valuable moreover $65 only a week ago, is now worthless at roughly $0.00019. The UST stable coin, which was formerly the world’s third-biggest with a market valuation of $18 billion, has plummeted to $0.11.
According to FXEmpire, Terra’s $3.5 billion Bitcoin treasury was relocated to exchanges last week. Meanwhile, this debacle has handed global bankers, regulators, and politicians an early Christmas present by providing them with the ideal pretext to crack down on the crypto business and impose stricter regulations.
Is There Going to Be A Terra Luna Announcement?
Despite several social media postings implying otherwise, TerraForm Labs has offered no hint that a major announcement is imminent.
Luna’s rapid price drop has spawned a new wave of Luna-centric Twitter accounts, many of whom are speculating on how Luna will reclaim its former glory and using normal Crypto Twitter language.
Users, on the other hand, have warned various Twitter profiles as possibly promoting a bogus Luna announcement. These announcements encouraged investors to prepare USDT on Binance, for example, while waiting for a major announcement. But there would be no announcement.
Other stories said a major Luna burn was on the way, following in the footsteps of those advocating Shiba Inu burns.
Other accounts, dubbed Luna 2.0, began marketing other cryptocurrencies alongside Luna. These coins, which had no connection to Luna or the Terra environment, were immediately “pumped and dumped” once their values skyrocketed.