On Monday, Do Kwon, co-founder of troubled blockchain startup Terra, announced a revised plan to restore the ecosystem after a combination of significant market volatility and inherent flaws in the protocol’s design wiped out the vast majority of the project’s market cap. .
According to Kwon, Terraform Labs will present a new governance proposal on May 18 to fork the Terra blockchain (token name: LUNA). However, the new network will not be tied to the TerraUSD (UST) stablecoin. In the meantime, the old Terra blockchain will continue to exist with UST and will be called Terra Classic (LUNC). According to Kwon’s plan, if approved, the new blockchain will go live on May 27.
Under the proposal, the new LUNA tokens will be sent to holders of LUNC, UST, and essential developers of the Terra Classic blockchain. Also, the Terraform Labs wallet with the address “terra1dp0taj85ruc299rkdvzp4z5pfg6z6swaed74e6″ will be removed from the whitelist for the airdrop, thus making Terra a fully community network. LUNC’s proposed supply is capped at $1 billion, of which 25% will go to the community fund, 5% to essential developers, and 70% to LUNC and UST holders, to be designated during several snapshots in May. , these will be subject to conditions of acquisition.
Just today, Luna Foundation Guard, the administrator of the ecosystem, has revealed that it has used an overwhelming part of its cryptocurrency reserves trying to defend the UST peg during the market crash. As a result, it is unlikely that the Terra ecosystem can be saved without the help of outside capital. Changpeng Zhao, CEO of Binance, said that she would support the Terra community, but that she would like to see more transparency from the entity regarding recent developments.
2/ It has been inspiring to partake in the dynamic discourse regarding the best next steps for Terra. Taking feedback from the community and thoughtful proposals, I would like to suggest the following for the path forward.https://t.co/E13VI8bkLh
A thread on our reasoning:
— Do Kwon (@stablekwon) May 16, 2022
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