Will Terra Classic’s 1.2% Tax Burn Proposal Restore The Blockchain’s Glory?
- All the on-chain LUNC transactions will be subjected to a 1.2% tax, which means that every person who initiates a transaction on the Terra Classic blockchain will have to pay a tax at a rate of 1.2%.
- The supply of the LUNC tokens rose abruptly in the second quarter of this year to retain the peg of the stablecoin of the platform, USTC.
Although Do Kwon’s Terra project tried breaking records recently, the blockchain failed disastrously and is now remembered as one of the biggest financial crashes in the history of the crypto world. Interestingly, since the rebranding of the blockchain, investors have been calling for a supply burn of the LUNC tokens, which were previously known as LUNA.
It seems that after a long wait, the burn proposal has surfaced but in the form of taxes. The supply of the LUNC tokens rose abruptly in the second quarter of this year to retain the peg of the stablecoin of the platform, USTC. Now with trillions of tokens, the Terra Classic (LUNC) holders wonder when will the excess supply be burnt and reduced to ashes.
According to an official tax burn proposal, all the on-chain LUNC transactions will be subjected to a 1.2% tax which means that every person who initiates a transaction of the Terra Classic blockchain will have to pay a tax at a rate of 1.2%. While this new tax will include wallet and smart contract interactions, it will not be applicable on crypto exchanges.
While the benefit of this tax will be to reduce the oversupply of the LUNC tokens, the major drawback of this situation is that it will make transactions of the Terra Classic chain more expensive and hence, developers might need strong conviction to make through the tough tax rule.
However, the drawbacks are of little concern to the community which is ready to accept this trade-off in a chance to transform the LUNC token into a deflationary token and reduce the oversupply of the cryptocurrency.
The crypto market has turned bearish with low chances of breaking into an uptrend in the near future. It seems that the chances of these coins making higher highs in the near future are considerably low. LUNC has also been a subject to the recent market crash as the data from CoinMarketCap confirms that LUNC has dropped by more than 12% in the last 24 hours. The price of 1 LUNC is $0.0002404.
Recently, Anonymous, a decentralized hacking group, has made a vow to expose all the alleged atrocities of the Terra foundation’s founder, Do Kwon.
Do Kwon, if you are listening, sadly, there is nothing that can be done to reverse the damage that you have done. At this point, the only thing that we can do is hold you accountable and make sure that you are brought to justice as soon as possible,”
the Anonymous group noted.
A crypto journalist with over 3 years of experience in DeFi, NFT, metaverse, etc. Parth has worked with major media outlets in the crypto and finance world and has gained experience and expertise in crypto culture after surviving bear and bull markets over the years.
