The level 1 blockchain, Terra Luna Classic, is entering a new era, as after a positive vote of 82% of its community the proposal to reduce the TAX BURN from 1.2% to 0.2%, of which 10% will go to the community’s treasury, has been passed.
The proposal to reduce the tax on all LUNC transactions within the chain was made for two reasons:
- To strengthen the community fund so that it pays mainly the developers and therefore is an attractive place to work. More developers, more dApps, more activity on the network, more LUNCs being destroyed.
- Because it was found that implementing the 1.2% tax reduced activity on the chain, as many people considered the tax high and therefore a deterrent to use it.
In essence, the community believes that the tax reduction will make Terra Luna Classic a more attractive destination and increase its utility and growth. That is, significantly less LUNC may be “burned” initially, but over time they estimate that dApps will begin to be created that will increase LUNC usage and thus the number of coins burned.
The community’s goal remains to reduce the number of LUNC coins in circulation to 10 billion.
At the moment there are 6.862 trillion coins in circulation, so there is a very long way to go before the goal is finally reached.
Since the start of the coin burn, 22.5 billion coins have been burned, i.e. 0.32% of the total. And the goal is to make 99% of the total amount disappear.
The exchanges
The cryptocurrency exchanges will also play a decisive role in determining whether they will adopt the application of the tax to transactions within exchanges (i.e. outside the Terra Luna Classic chain).
The previous tax was not adopted by any exchange for fear that traders would leave for other exchanges that did not apply the tax.
The exception was Binance, which did not apply the tax to in-exchange trades, but all revenue from LUNC trades was converted to LUNC and would be “burned”. Now we will have to wait for their reaction to the new data and the significantly lower tax.
Difficult to estimate
It is very difficult to estimate how the Terra Rebels, as the group is called that has taken on the task of rebuilding the Terra Luna Classic after its historic collapse a few days ago, will fare. It is undoubtedly an initiative worth following with interest.
