Binance Breaks the Silence on LUNC Tax Burn. After the collapse of Terra Luna, Bikace CEO Changpeng Zhao did not take to it very well. CZ said that the irresponsible nature of the CEO, DoKwon led to the collapse. Also, a cryptocurrency should be able to refund its users following such an occurrence.
“I am very disappointed with how the Terra team handled this UST/LUNA incident (or not handled). We requested their team to restore the network, burn the extra minted LUNA, and recover the UST peg. So far, we have not gotten any positive or much response.”
However, things seem to have changed because yesterday, September 8, 2022, Binance shared information concerning the LUNC Tax Burn.
Notice on Tax Burn for LUNC and USTC on Terra Classic LUNC Network.
Addressing its members, Binance said that Terra Luna had passed two proposals that will introduce a 1.2% on all transactions on the network. Proposals 4159 and 3568 will be effective from the 20th of this month, September 2022.
Any transactions on the network will no longer be free but will charge users $0.012 as trading fees. Terra Luna will tax deposit and withdraw transactions. For the deposit, Terra Luna will tax before the transactions reach Binance, and for the withdrawal, Terra Luna will tax the transactions.
Other exchanges supporting the tax burn include Kucoin. Kucoin gave an official announcement:
“Dear KuCoin Users,
KuCoin will support the 1.2% tax burn proposal of the Terra Classic (LUNC) community.
- KuCoin will support the 1.2% tax burn when the proposal is officially approved and implemented on Terra Classic (LUNC) mainnet.
- Services on KuCoin will remain unchanged if the community does not approve the proposal.
- To avoid the potential increase of the deposit fee cost, we strongly suggest users deposit all the mainnet Terra Classic (LUNC) tokens into KuCoin before September 12, 2022.
Related follow-ups to this subject will be announced separately as soon as possible.
Proposal ID 3568: Tax/Burn 1.2% all Transactions
Terra Luna wants to implement a Tax Burn mechanism to reduce the total supply of the coins. For a long, LUNC users on Twitter have proposed a tax burn to recover losses. Many were not open to a hard fork of the LUNA system. It is a relief that their cry is finally being heard.
Propositions of Proposal 3568:
- Activate LUNC Tax Burn.
- Share the LUNC burn address on social media.
- Share LUNC Tax Burn with popular trading platforms.
- Reduce the supply of LUNC to 10 billion coins only.
- Deactivate the mechanism after the goal is reached.
- Maintain the 10 billion supply of LUNC tokens.
The proposal was made by a Terra Luna community member and voted for.
Proposal ID 4159: Distribution Code for 3568 (for the 1.2%burn) and 4095 (re-enable delegation and staking).
This proposal covers two aspects, the 1.2% tax burn and re-enabling delegation and staking. Terra Luna created the proposal to distribute code for proposals 3568 and 4095.
The proposal proposes a code in connection to recovery as follows:
Check out Terra Luna’s official page for more information on the code.
According to the proposal, TFL must support the code implementation or develop a solution. If TFL fails to communicate within ten business days, Luna will distribute the code to validators from a valid GitHub repository.
Will the Luna Tax Burn help TerraLuna?
The LUNC and USTC tax burn will positively impact the network. Following the collapse of Terra Luna earlier this year, this step will help affected users recover from losses. TerraLuna will also find a way to refund its impacted users. It is never too late to amend damages.
Starting mid-September, TerraLuna has been bullish, with exchanges like Kucoin supporting the tax burn. Just this week, LUNC and LUNA have gained by 100%. This massive gain might be a result of the proposed Lunc burn.