As Terra and UST historic lows continue to emerge, new packages announced by founder Do Kwon show that Terraform Labs is not yet willing to give up. On May 11, at Do Kwon’s proposal, the community voted for a new package that would increase Terra’s daily mintage capacity. While the compensatory steps were not enough to stop the collapse of UST (0.4807) and LUNA (0.07745), new measures including token burning are included in the package today…
Terra launches its bid to burn remaining UST
Terra Station The proposal, called “Agora”, launched in May under number 1164, focuses on adjustments to the minting and burning parameters of Terra’s algorithmic stablecoin, UST.
- Voting is currently ongoing.
- It was distributed with a total of 452.31 million votes (out of 515.46 million), 62% in favour, 36.82% abstaining, and 0.57% mixed as “no” and “no and veto”.
- The main points of the proposed plan are increasing BasePool from 50 million to 100 million SDR and reducing PoolRecoveryBlock to 36 blocks.
- The offer is currently approved and expected to be launched in 6 days.
What will happen to the price of the LUNA?
With this offer, printing capacity will be increased from $293 million to approximately $1,200 million. According to the author of the proposal, the result will help speed up UST exits from the system, reduce pressure on the UST, but this is expected to negatively impact the LUNA price
As a result, Terra team has 3 contingency measures, one of which is focused on burning more UST. These are:
- Proposal to burn remaining UST in the community pool: Although there is 1 billion UST in the pool, its value is approximately $580 million.
- will be burned at 371 million UST on the Ethereum network.
- 240 million LUNA will be staked. This will prevent attackers from interfering with the network due to low prices.
Terra (UST) team assured of compensation
At this time, the future of the Terra community is uncertain. LUNA is down almost 100% again today and is currently trading at $0.05.
UST is trading at $0.49, about 50% below its supposedly stable $1.
However, Terraform Labs warns its followers that recovery will accelerate once the fix proposal is accepted. They also treated the current situation as a war room and reassured that for the past four days they have been relentlessly trying to find a way to help victims and “stop the collapse”.
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