Terra founder Do Kwon reveals his plan to rescue UST. The basis of the plan is to increase the minting capacity.
Kwon acknowledged in a tweet thread on his Twitter account that 72 hours were extremely difficult for the Terra community and said he hopes the plan will help UST survive. As is known, capital out of UST results in too many Luna sales due to the working of stablecoin mechanics. In this way, the loss of LUNA in the last 24 hours exceeded 90%. Kwon said in a statement on the subject:
“First of all, it will be to absorb the stablecoin supply that will come out before we start fixing the UST again. There is no way to get over it.”
Accordingly, the community will first approve a community proposal that will increase the amount of Luna minted per day:
“Naturally, this comes at a high cost to UST and LUNA owners. However, we will continue to explore various options to bring more external capital into the ecosystem and reduce the supply load on the UST.
Kwon also added that in the future, the stablecoin will be redesigned to be collateralized.
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