Another attempt to support Terra’s revival (LUNA), the community voted in favor of burning large amounts of UST from its pool.
Do Kwon, Terra founder, explained earlier in May that one possible solution to the Terra crisis was to absorb stablecoin supply. Users suggested that Terra’s community pool store 1 billion TerraUSD (UST). The remaining cross-chain UST can be used on the Ethereum blockchain to provide incentives.
According to the proposal, the fire will “reduce the outstanding debt of the Terra economy.” It’s also expected that it will play a significant role in restoring the UST dollars peg by eliminating a large portion of excess supply.
The proposal was submitted May 12, and was due to be completed in seven days. It failed to take effect due to a mismatch between the amount of UST in community pool and the proposal. Another proposal was made, which resulted in the revocation of funds from the pool.
The community came up with another proposal, which was approved by the community on May 20. This would allow the fire to continue. The proposal was approved after seven days with 153 644,852 votes in favor of burning the UST supplies.
Related: New LUNA tokens listed by exchanges indicate initial support for Terra revival
MEXC Global, a crypto exchange, also pledged to support the project with community burning efforts. They will also be holding a one-month-long buyback and fire for LUNA. The platform promised to use the trading fees from the new LUNA/USDT spot trade pair to purchase LUNA and send it back to the burning address.
Kwon doesn’t support burning, despite sharing a Terra burn address. Kwon, the Terra founder, warned “LUNAtics” not to send LUNA to the burning address. Kwon said that burning won’t do anything. Kwon told users that nothing happens except for the fact that you lose your tokens.
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