800 Million USTC Burn: How LUNC Community Addresses Kwon's Missteps

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.

Thank you sincerely to everyone who expressed interest in the recent post about the return of the 800 million #USTC . I am delighted to see so many creative ideas being shared, and each one holds merit. Rest assured, there are no bad ideas in this discussion.

However, before we… pic.twitter.com/rgSIpDRoDV
— Vegas (@VegasMorph) July 26, 2023

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.

For USTC to have any future, inert USTC like this must be destroyed (sent to a burn address), not returned to the community (== dumped back onto the market).

This should increase the USD value of others' existing USTC as the market will expect more such decisions by the…
— 4lex (@_4lex_4) July 26, 2023

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.

TagsCrypto LUNC USTC

Judith Faith

Judith Faith has been writing about cryptocurrencies and blockchain technology for over five years. She is well versed in the industry and has an extensive network of industry contacts. She is also a frequent contributor to various cryptocurrency publications. With her vast knowledge and experience, she is able to provide insightful and valuable content to her readers. Judith is also an active investor in the cryptocurrency space and has a vested interest in the success of the industry.