The Terra Classic (LUNC) community has voted to stop all minting and reminting of Terra Classic USD, the algorithmic stablecoin formerly known as UST that was at the center of the Terra ecosystem’s $45 billion collapse.
Terra allowed users to freely swap between UST and LUNA, its companion cryptocurrency. However, when UST de-pegged in May 2022, the mechanism failed in dramatic fashion as trillions of LUNA tokens were minted and the price of UST fell below one cent.
A proposal to finally halt that swapping mechanism, which aims to protect "the community and outside investors who are burning USTC helping to achieve the repeg,” passed with 59% approval.
The Terra Classic community hopes to eventually help the coin regain its original $1 peg by burning those trillions of tokens that were created during its collapse. So far, the community has managed to burn only 75 billion tokens, around 1% of the nearly 6 trillion circulating tokens, according to LUNC Metrics. The current value of USTC is $0.012.
Following the collapse of the Terra ecosystem, Terraform Labs co-founder Do Kwon launched a new version of the blockchain, commonly known as Terra 2.0, while the Terra Classic community stood by the original blockchain.