The Terra Classic (LUNC) community faces a pivotal moment as it rejects a proposal to burn 800 million USTC due to concerns over technical complexities and potential legal implications. The decision reflects the community’s commitment to finding alternative solutions for reducing the circulating supply while navigating challenges.
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Rejected Proposal and Community Sentiment
In a crucial vote, the Terra Classic community turned down Proposal 11913, titled “RH MultiSig Wallet – Burn 800m via Update to Terrad Client.” The proposal aimed to burn dormant USTC held within the Risk Harbor multisig wallet. However, it received only 14.24% “Yes” votes, with a significant 50.02% “Abstain” vote, and 25.18% voting “No.” The lukewarm support indicates community apprehension about the proposed method’s reliance on a client update, potentially exposing validators to unforeseen legal risks.
Technical and Legal Concerns
Community members expressed reservations about the technical complexities and potential legal risks associated with the proposed client update. The rejection underscores the cautious approach the Terra Classic community is taking in navigating challenges related to the circulating supply reduction.
Status of Frozen USTC in Risk Harbor Wallet
With the rejection of the proposal, the 800 million USTC in the Risk Harbor wallet remains frozen and inaccessible due to lost keys and a communication blackout with Risk Harbor. The community acknowledges the symbolic importance of burning these funds originally designated for USTSC peg protection, emphasizing their commitment to unity and revival.
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Alternative Proposals and Community Commitment
Despite the setback, the Terra Classic community remains dedicated to USTC burn initiatives. Validator Lunanauts proposed an alternative approach, suggesting the creation of a contract to burn the funds directly from the Risk Harbor wallet. This method eliminates the need for a client update, addressing legal concerns and providing a potentially smoother burn process.
Market Reaction and Price Movements
The rejection of the proposal has had a notable impact on the market. LUNC has experienced an 8.23% drop in the past 24 hours, trading at $0.0001509 at the time of writing. USTC has seen an 11.15% price plummet, currently trading at $0.03261. Despite the decline, both tokens have witnessed increased trading volume—USTC with a 48.12% surge to $38.59 million and LUNC with a 34.25% increase to $107 million in the last 24 hours.
Community Engagement and Future Prospects
The active participation from the community, as evidenced by increased trading volumes, suggests ongoing interest and engagement despite the failed proposal. The rejection has prompted further discussions in the Terra Classic Commonwealth forum, with various alternative proposals being considered to address the circulating USTC issue. The community’s resilience and commitment to finding solutions could play a crucial role in shaping the future trajectory of LUNC and the Terra Classic ecosystem.