Binance delivered on its promise and today “burned” the first batch of LUNC, worth $5.5 billion, worth $1.8M.
Following this development, a total of more than 13.5 billion LUNC have been “burned” so far, or 0.19% of the total amount of Terra Luna Classic coins. The total amount of LUNC currently stands at 6.880 trillion coins and the community’s goal is to reduce it to 10 billion. This effort is still in its early stages.
Many or few
As expected, after the first LUNC burn from Binance, discussions started about whether this performance is enough to realize the Terra Luna Classic community’s big goal.
One school of thought believes that the start of the effort to reduce the amount of LUNCs is very encouraging and when all other actions are added, the daily number of “burns” will increase dramatically.
The other school of thought believes that Binance’s performance is just a drop in the ocean and that the whole community effort will be crowned with abject failure.
We did the math
Doing simple math, we conclude that on average Binance “burns” 780 million LUNC per day.
If we add the approximately 300 million that are on average burned by the 1.2% BURN TAX, we conclude that on average about
- *1.1 billion LUNC are “burned” every day and will “burn”
- *7.7 billion a week,
- *31 billion a month and
- *370 billion a year.
*Based on the actions taken so far.
The next day
Based on the above performance, it is extremely difficult for the Terra Luna Classic community to reduce the amount of LUNCs to the 10 billion level anytime soon.
However, this should not be taken as the final determination as essentially the community’s effort has now begun.
The number of LUNCs burned every day is expected to grow under certain conditions:
- if other exchanges follow Binance’s path,
- if trading on Binance’s exchange increases, but most importantly
- if the Terra Luna Classic chain gains more utility.
Continuing from the last point, it seems that a new NFT game is being launched on Terra Luna Classic, through which – according to its developer (Lithosphere) – the amount of LUNC that will be “burned” daily will increase.
It is understood that the more the chain’s utility increases, the more LUNC will come out of circulation.
Decrease in price = More burning
However, there is something else important to note. If the well-known: Buy the rumor, sell the news occurs, i.e. if as soon as the amount of LUNC that Binance burned is announced, massive coin sales occur and the price drops significantly, what will that mean for the effort to get LUNC out of circulation?
Quite simply more will be burned, as – for example – Binance’s $1.8M will buy more LUNCs and destroy them.
Tough bet
In summary, it was and remains a difficult task for the Terra Luna Classic community to restore the amount of LUNC to the levels it was before the historic collapse. However, it is admittedly an impressive effort and a real desire to succeed.
That should and deserves to be acknowledged.
We will continue to monitor the progress of this effort and will update if any significant developments occur. Follow us on Twitter or subscribe to our notifications.
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