Terra Classic (LUNC) Tax Burn To Be Reduced To 0.2%! Here’s Why.

Author: Sohrab Khawas

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    The Terra Classic (LUNC) community has been adopting several strategies to revive the stability within the network. 

    In the latest attempt, they passed Proposal 5234 after a week-long debate and vote. This was confirmed via Tweet by Akujiro, a community member

    Alex Forshaw, a LUNC developer, presented the voting details and disclosed that 83% of the members had participated in the decision. 

    Proposal 5234 is a draft that indicates that the community should reduce the 1.2% tax burn to 0.2%, and 10% of the tax should be dedicated toward the network’s development activities. Through this, the community plans to increase the on-chain volume while burning LUNC. However, it’s worth noting that since the time the 1.2% tax went live, LUNC’s on-chain volume has dropped by 90%. Meanwhile, till today, Binance has burnt more than 6.5 billion LUNC from 1.2% tax.

    Initially, the proposal did face resistance from a few supporters as they felt it was too early for such a move. However, in accordance with the community’s wishes, the new 0.2% tax burn is expected to go live on October 19 around 12:50 pm.

    Terra’s Revival Plan

    After the terra  network collapsed in May, a revival plan was drafted, which said that around 10% of the LUNA supply will be allocated to the network and 80% of the funds will be used for developer mining rewards.

    However, a Terra staff member later claimed that there are not many projects with total locked value, and mining revenue cannot be allocated without competition.

    Now, there is a new proposal which claims that the mining rewards will be reduced from 80 million to 20 million LUNA. In addition, nearly 5 million LUNA will be given to the users to increase engagement.

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