Following the unsettling collapse of Terra in May 2022, the Terra Classic community is debating a new proposal aimed at restoring stability to its TerraClassicUSD (USTC) stablecoin. Central to the discussion is a proposition that nudges Binance, the world’s largest cryptocurrency exchange, to burn 50% of its USTC trading fees. This development adds another layer to the dramatic efforts to resurrect a project that once had a prominent standing in the crypto-verse.
Two closely related proposals have been put forth on the Terra Classic governance forum, and they’re drawing significant attention from the community. Read on.
Proposal #11785: Binance Burn Program for USTC
The first proposal, fittingly labeled #11785, primarily revolves around persuading Binance to expand its existing fee-burning mechanism to USTC trading pairs. Presently, Binance burns 50% of its trading fees from Terra Classic (LUNC) pairs. If this proposal garners acceptance, it would mark a substantial victory for the struggling USTC stablecoin. Binance facilitates trading pairs such as USTC/USDT and USTC/BUSD, collectively boasting a trading volume of approximately $5 million in the last 24 hours.
The rationale is clear-cut: if the world’s most influential cryptocurrency exchange burns a portion of the USTC supply, it stands to reason that this move could fortify efforts to re-anchor the stablecoin to the US dollar and potentially revitalize the value of its counterpart, LUNC.
Proposal #11786: Curbing USTC Minting
Running in parallel with the first proposal is another initiative, known as #11786, with the objective of restraining the minting of USTC. This initiative targets the closure of loopholes that enable unwarranted expansion of USTC’s supply. Here, the community is seeking a say in any prospective minting activities, thereby safeguarding against the arbitrary creation of the stablecoin.
As it stands, these proposals have generated polarizing opinions within the community. Proposal #11785 has garnered support from 41.11% of voters, while a significant 57.02% chose to abstain, with a mere 1.73% voting against it. The proposal concerning USTC minting limitations is also embroiled in a fierce contest, with 47.32% in favor and 44.34% against. It’s a tug-of-war, where each vote carries significant weight.
The proposals don’t just represent mere governance changes; they embody the community’s ambitions and its resilience in the face of adversity. Meanwhile, USTC currently trades at a mere $0.012, a long way off from its intended peg to the US dollar. Only time will tell if these proposals can inject the much-needed stability and vitality into the Terra Classic ecosystem.