The infamous collapse of the Terra ecosystem, which wiped out the market prices of TerraUSD (UST) and LUNA tokens, continues to worry anxious investors as co-founder Do Kwon, crypto exchanges and the community try to jointly identify the best route to a sustainable price recovery.
Recently, Changpeng ‘CZ’ Zhao, the CEO of cryptocurrency exchange Binance, recommended a flat 1.2% trading tax on LUNC operations that could be burned to reduce the token’s total supply and improve its price performance. Addressing the community, CZ stated:
“We will implement an opt-in button (on the Binance exchange), for people to opt in to pay a 1.2% tax on their LUNC trades.”
However, the exchange would begin taxing opt-in traders following the consensus of 25% of LUNC investors, ensuring that early adopters “are not the only ones paying an extra 1.2%.”
A general tax of 1.2% will only be applied to all LUNC trades when eligible traders reach 50% of the total LUNC trading volume on the exchange.
I answered the question about LUNC in my Twitter Space AMA just now.
Another option is to implement a feature to let users opt-in for a 1.2% trading fee themselves for burn. And see how many of the voting community do that first. Vote with your fees.
— CZ Binance (@cz_binance) September 23, 2022
The recommendation divided the LUNA community as some supported CZ’s decision to implement the opt-in button while others interpreted it as market manipulation by a centralized entity.
CZ supported burning LUNC but believes in community voting, allowing the platform’s traders to finalize the suggestion, adding: “We listen to and protect our users.” However, the trader is aware that unless the change is implemented across exchanges and on-chain, LUNC traders will prefer to move assets to other exchanges that do not have the burn.
At the other end of the spectrum, South Korean authorities are trying to locate and arrest Kwon for the collapse of Terra.
On September 14, a court in Seoul, South Korea, issued an arrest warrant for Kwon and five others for violating the country’s capital markets law.
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