Just-In: Terra Luna Classic Community Revises LUNC Burn Tax

by

As a seasoned Terra Luna Classic investor with a deep understanding of the intricacies of their governance proposals, I find the recent approval of Proposal 12098 an interesting development. The community’s decision to change the reward share distribution of the burn tax instead of the rate itself is noteworthy. Although it may seem like a minor adjustment, it could have significant implications for long-term stakeholders and the overall ecosystem.

The Terra Luna Classic community has made a decision to alter the distribution of rewards from the burn tax rather than adjusting the tax rate itself.

Currently, the price of LUNC is weakening and may struggle to regain momentum due to the wider crypto market’s downward trend prior to the approaching $9.4 billion crypto options expiry.

Terra Luna Classic Burn Tax Proposal Passed

The community of Terra Luna Classic has approved Proposal 12098, titled “Adjusting the Allocation of Burn Tax Rewards.” As a result, the rewards from the burn tax will now be allocated between the community pool and the Oracle pool.

Significantly, this proposition keeps the burn tax rate and the quantity sent for burning unaltered. The only modification is shifting the burn tax distribution from rewards to oracle pools. This proposition has gained approval from 70% of the voters, with a total of 37 validators endorsing it.

“The technical details of this can be a bit complex. I will try to simplify some of it at the cost of a little less precision in definitions and numbers. This draft has been up a few weeks ago with more details on block proposer rewards. I removed those parts as proposer rewards will be removed with SDK 0.47, said developer StrathCole.

I’m observing that Terra Classic imposes a burn tax of 0.5%. Of this tax, 80% is allocated for burning, while the remaining 20% is divided: 10% goes to the Community Pool and another 10% is distributed as rewards. Following the approval of the proposal, however, the distribution of the 20% will change: 10% will continue to be added to the Community Pool, but now an additional 10% will be allocated to the Oracle pool instead of rewards.

As an observer, I’d describe it this way: Instead of receiving immediate block rewards, a portion of the burn tax will be set aside for long-term staking rewards. This means that the total return on staked assets would be slightly lower than before, estimated to decrease by approximately 0.5%. However, this reduction is subject to change based on the volume of transactions processed on-chain.

LUNC and USTC Fell

I’ve observed a significant 8% drop in LUNC price over the past 24 hours, which coincided with a broad market selloff. At present, the price hovers around $0.0001027. The range of prices during this period reached from a low of $0.0001014 to a high of $0.0001115. Additionally, trading volume has seen a slight decrease, signaling reduced trader interest in the last 24 hours.

Concurrently, USTC’s value decreased by more than 8%, reaching a price of $0.01842. In the past week, it had surged by approximately 20%. The lowest and highest prices in the previous 24 hours were $0.01814 and $0.01997, respectively.

Read More

2024-04-25 16:53