The embattled Terra Luna Classic (LUNC) community is taking steps to restore 800 million malfunctioning stablecoin Terra Classic USD (USTC).
The colossal amount of USTC was initially sent to Ozone Protocol by Do Kwon, the controversial founder of Terra blockchain.
In an effort to rectify the situation, a community member named Vegas Morph has presented a governance proposal, urging the LUNC community to vote on returning the funds to the Terra community pool.
In a Medium post titled “Return 800 million USTC, Now,” Vegas Morph outlines the reasons behind the proposal and calls for action from the LUNC community.
If the proposal is approved, the community-allocated funds will be returned to the Terra community pool, aligning with the shared belief that the 800 million USTC must be restored.
The key issue behind the proposal lies in the mishandling of the one billion USTC initially sent to Ozone Protocol. While the first two versions of the protocol saw high demand due to its underwriting capacity, the subsequent mismanagement raised concerns.
Terra members were left unsatisfied with the project’s failure to adhere to the projected development plan, leading them to request the return of the remaining 800 million USTC.
Although all Terra Classic members agree on restoring the 800 million USTC to the community, differing opinions arise on how to utilize the funds.
Vegas Morph proposes sending the retrieved on-chain funds to the Luna Classic community pool. However, other prominent community members advocate for the destruction of inert USTC, arguing that it would be more beneficial to burn the cryptocurrency rather than reintroduce it into circulation.
Financial engineer Alex Forshaw supports the idea of burning the 800 million USTC, as it would serve to strengthen the struggling community.
He suggests that burning the retrieved funds would increase the USD value of existing USTC holdings, as the market would anticipate further decisions by the community to burn additional funds.
Forshaw highlights that this approach aligns well with Terra Classic’s ongoing efforts to revitalize the chain and rebuild community confidence.
