Binance shook things up with the unexpected move for Terra Luna Classic (LUNC), as it announced yesterday morning that it will be “burning” LUNC transaction fees within its exchange.
The decision by the leading cryptocurrency exchange has been met with great satisfaction by the Terra Luna Classic community, as it believes that the move is capable of making a decisive contribution to the effort to drastically reduce the amount of LUNC coins currently in circulation.
Previously Binance had been the recipient of much criticism from the Terra Luna Classic community for the initial proposal it had put forward, which we discussed in a previous issue.
According to an official statement from the exchange, it changed its proposal after:
a) it turned out that it would take time to implement the original proposal,
b) the majority of the Terra Luna Classic community did not like the original proposal, and
c) the proposal would not pass the Traders.
What the new proposal states
Under Binance’s new proposal, it will not collect LUNC and USTC transaction fees, but will convert them to LUNC and “burn” them to contribute to the community effort.
That is, traders will not have to pay higher fees than they currently pay, but Binance will lose those proceeds and “sacrifice” them to help reduce the amount of LUNC coins.
Binance will collect all fees Monday to Monday (one week), convert them to LUNC and “burn” them. Every Tuesday it will update on the total amount of LUNC “burned”.
Therefore, the first update is expected in one week, next Tuesday. There it will be seen for the first time how much Binance can contribute to TAX BURN.
The maths has begun
On hearing this proposal, the Terra Luna Classic community started the… maths, in order to come up with the LUNC amount that will be “burned” every week by Binance.
The exchange charges 0.1% fees on every transaction and 0.01% fees to its VIP members. This percentage may seem small, however when you consider the millions that trade on Binance’s exchange then you understand that a not insignificant amount of LUNC will be “burned” on a weekly basis.
How many LUNCs are currently being burned and the outlook
These first few days of implementation of the 1.2% BURN TAX are “burning” about 350,000.000 LUNC per day.
So far 6,378,647,394 LUNC have been “burned” (not only from the BURN TAX), which is 0.092402% of the total amount of coins.
Undoubtedly, Binance’s decision is expected to raise the daily number of LUNC that on average will leave circulation. It remains to be seen at what points it will reach and also whether other exchanges will follow the same path.
As a reminder, the goal of the Terra Luna Classic community is to reduce the amount of LUNC coins from 7 trillion where it was, to 10 billion.