The 1.2% Burn Tax proposal on LUNC and the price spike
Terra Classic (LUNC) is inching closer and closer to a landmark community vote, which barring any contingency will approve a proposal to burn 1.2% of LUNC in every transaction.
The Twitter account, LUNA Burn Tracker, created to track the progress of the LUNC “burn”, revealed that the “1.2% burn tax” proposal for LUNC will be available for a vote on September 10 and if approved will be activated around September 20.
“This is the official date for the 1.2% burn tax proposal to be activated. The vote will be on or before September 10 and the activation date, once the vote passes, will be on or around September 20,” wrote LUNC burn tracker.
This placement confirms what TerraRebel, a Terra Classic community, claimed shortly before.
Impressive rise for LUNC
We should note that LUNC, the coin of Blockchain Terra Classic, has seen an impressive rise in the past week and is the hottest cryptocurrency at the moment, precisely because of the developments happening in its network and the potential they create.
For example, due to the huge demand for the coins, the tokens on KuCoin were depleted, while the trading volume on Binance reached over $1 billion.
The proposal
If the 1.2% tax proposal is approved, it will see users pay a 1.2% commission by “burning” 1.2% of the LUNC amount in each transaction that occurs within the Terra Classic chain.
This 1.2% charge is then sent to the “burn” wallet provided by Terra, with the aim of reducing the total amount of LUNC in circulation.
It can be understood that as the quantity in circulation (7 trillion coins currently in circulation) decreases, the price of LUNC will increase.
The role of the central exchanges
Of course, this admittedly remarkable proposal cannot work without being implemented by the exchanges, as most LUNC transactions take place on central exchanges.
However, already exchanges such as KuCoin, Y5, MEXC Global, CoinInn and Gate.io have already accepted the implementation of the 1.2% tax.
It remains to be seen which other exchanges will implement this proposal, as its success depends largely on this parameter.
The perspective
Undoubtedly the decrease in the amount of LUNC combined with an increased demand for the coin, create a… cocktail capable of bringing back to the forefront the Luna Classic, which we recall that a few months ago collapsed overnight and lost almost all of its value, causing serious losses of money to those who had invested in it.
It should be noted that after the collapse the founder of the ecosystem created a new Blockchain, which he named Terra, and thus the original chain was renamed Terra Classic and its currency was renamed Luna Classic (LUNC).
Since then, Terra Classic has been run by its community and decisions are made by voting. In the course of Terra Classic up until the decision to “burn” coins, the founder of Terra who had led it to collapse, Do Kwon, had no involvement in decision making.
If everything materializes based on the plan of the Terra Classic community, then it is possible that we will see LUNC continue the crazy upward trend of the last few days with even more momentum.
Originally published at https://bitnewsbot.com on September 8, 2022.
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