Terra’s ‘Revival Plan’ to redistribute ownership to UST and Luna holders
Luna, the fallen cryptocurrency that was created to act as a peg to the stablecoin TerraUSD (UST) caused LUNA to lose its peg to the U.S. dollar. Luna has fallen to below a penny while UST fell to 15 cents last week. This dramatic spiral wiped out US$ 1 trillion in the cryptocurrency market and sent Bitcoin to plummet over 20%.
On Friday, Terra Labs CEO Do Kwon wrote an announcement on Terra’s ‘Revival Plan’, outlining the aim to redistribute ownership in the network across UST and Luna holders. Luna’s price skyrocketed from near zero last week to between US$ 0.0003 and US$ 0.0005, over 1,000% surge following the announcement. Binance delisted the Luna/ UST trading pair and resumed spot trading for Luna last week.
Kwon admits the value of Luna has experienced a total collapse and UST has lost its reputation as a trusted decentralized currency in the market.
‘Even if the ‘UST’ peg were to eventually restore after the last marginal buyers and sellers have capitulated, the holders of Luna have so severely been liquidated and diluted that we will lack the ecosystem to build back up from the ashes,’ Kwon wrote.
Reviving the Terra Blockchain
He continued that to revive the Terra Blockchain, Terra will redistribute ownership of its blockchain to the community and developers. The redistribution can be viewed as a restart of the Terra Blockchain, would create 1 billion tokens to be distributed as follows: 40% to Luna holders before UST de-pegging; 40% to UST holders ‘pro-rata’ at the time of the new network upgrade; 10% to Luna holders right before the blockchain halt; 10% to the community pool to fund future development of the blockchain.
‘UST holders need to own a large share of the network, as the network’s debt holders deserve to be compensated for the tokens they have been holding to the end.’ Do explained.