The Terra Luna Classic (LUNC) community recently took a significant step in its recovery plan by burning a massive 1 billion USTC and 275 billion LUNC tokens. This burn followed the approval of proposal 12135, which resulted in 726 million USTC tokens being burned from Anchor Protocol.
This move came after a U.S. bankruptcy court granted Terraform Labs (TFL) approval to wind down its operations. With legal backing, the Terra Luna Classic community now plans to burn billions more LUNC and USTC tokens across various related projects.
Token Burn: Will It Revive LUNC and USTC Prices?
The Terra Luna Classic community hopes that these large-scale burns will help revive token prices. According to a recent CNF update, increasing the burn tax from 0.4% to 1.5% would effectively triple the contribution to both the community pool and the oracle pool. This adjustment could accelerate the pace of token burns while boosting funds for long-term staking rewards.
Following the burn, Terra Classic (LUNC) experienced a modest price uptick, trading at $0.00008524, marking a 0.64% increase over the past day and a 3.74% rise for the week. However, trading volume remained low, partly due to broader market pressures.
A Closer Look at the Proposal
The recent burn was carried out through a contract migration in Anchor Protocol. The proposal passed narrowly, with 27.23% of votes in favor. Interestingly, only 25% of validators supported it, but 92% of delegators voted “Yes,” recognizing that these tokens are community assets.
While the migration of Anchor Protocol’s contract was successful, an attempt to burn 46 million USTC from Mirror Protocol failed, prompting further investigation into the issue.
What’s Next for Terra Luna Classic?
The Terra Luna Classic ecosystem is moving forward with its ambitious burning strategy, but market pressures and mixed responses to proposals mean the path forward could be bumpy. Despite these challenges, the community remains optimistic that these efforts will lead to a price rally, especially if further burns and tax adjustments are implemented successfully.
