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Terra Classic community members express mixed feelings over the newly minted LUNC due to the 0.2% burn tax proposal.
Yesterday, various members of the Terra Luna Classic (LUNC) community expressed confusion after seeing a green candle pop up on StakeBin, which allows the public to track LUNC supply.
The candle indicated that the chain had minted nearly 200 million LUNC, taking some in the community by surprise.
Did we just minted another 173M #Lunc ? pic.twitter.com/TBlSkgV5rT
— SSL (@CRYPTOSHAWN7861) October 26, 2022
Consequently, members of the Terra Rebels, an independent team of developers supporting the Terra Classic chain, have had to clarify that the newly minted LUNC resulted from the community’s approval of proposal 5234. Notably, core developer Tobias Andersen AKA Zaradar shared an excerpt from an article by fellow core developer Edward Kim where he cautions the community not to be surprised when they see a green candle on the chart.
pic.twitter.com/o4yqjAzDas
— Tobias Andersen (@ZaradarTR) October 26, 2022
Proposal 5234, which the community passed on October 17, reduced the on-chain burn tax from 1.2% to 0.2%. In addition, it sets aside 10% of the burn at the end of every LUNC chain epoch (approximately seven days) for the community pool so that the network can fund development activities. As highlighted by Kim in the medium blog post explaining his decision to support the proposal during the governance voting process, this 10% required from the total burn is minted and sent to the community pool.
Meanwhile, in addition to the initial surprise, several community members were unaware that the proposal would collect seignorage on all burns, not just the burn from the on-chain tax. While this is a detail Kim’s article captures, the reality of this does not seem to sit well with some in the community. Comments show that some feel the Binance burn and all other voluntary burns by members of the community and its supporters should be excluded.
ONLY on-chain transactions must be counted that what all #LUNCcommunity had thought before on the tax burn reduction proposal
— Muhammad Ibrahim (@Muhamma44883621) October 26, 2022
Notably, reXx of the Terra Rebels has already made a simple suggestion to fix the concern, saying the community can propose to take out the difference from the community pool and send it to the burn address.
I see a few comments in here having concerns about the binance burns. An easy solution is to calculate what was sent to the community pool, run a proposal to take the difference out and send it to the burner.
TR does not wish to accept any funding from the community.
— reXx™ (@reXxTerraRebels) October 26, 2022
It is worth noting that the community passed proposal 5234 in the hopes of reclaiming lost on-chain volume while speeding up the rate of LUNC Burns. Unfortunately, as reported by The Crypto Basic, while on-chain volume has seen a boost, the rate of burns from the on-chain tax has significantly declined.