Terra Luna Classic Considers Raising Burn Tax to Boost Token Value

LUNC users are closely monitoring how a proposed increase in the project’s on-chain burn tax rate could impact the LUNC price.

The ongoing debate surrounding the LUNC burn tax proposal has not yet swayed the crypto token’s trajectory, perhaps because implementation, if passed, would not be immediate. The new tax rate would only take effect once the LUNC supply reaches 10 billion tokens.

Terra Luna Classic validator JesusisLord submitted the proposal to raise the burn tax rate from 0.5% to 1.5%. Community members anticipate the proposal could significantly affect the LUNC ecosystem’s dynamics. Currently, the burn rate is split into two parts: 80% allocated to the burn mechanism, and the remaining 20% divided equally between the community and oracle pools.

The proposed increase to a 1.5% LUNC tax rate carries several implications. If approved, it would raise the burn allocation from 0.4% to 1.2%, effectively tripling contributions to both the community pool and the Oracle pool. Users expect this higher tax rate to accelerate the burning of LUNC and USTC, boost funding for both pools, and ultimately support long-term staking rewards.

While the outcome of the proposal remains uncertain for most community members, JesusisLord expresses optimism about its potential benefits for the LUNC ecosystem. He believes it would substantially improve the token burn rate and enhance financial support for community projects and staking rewards. However, users are also carefully considering the proposal’s potential impact on LUNC’s market price.
LUNC experienced a 4.39% decline in the last 24 hours, continuing a pullback from its July high of $0.000096140. TradingView data shows the altcoin was trading at $0.000077945 at the time of writing.