Terra to launch a spin-off Blockchain this Friday
After investors lost a lot of money when the supply-demand ratio of algorithmically designed stable coins broke, Binance, Coinbase, and other cryptocurrency exchanges put Terra-Luna coins on their “do not trade” lists. Check https://www.bitiq.org/ to get a piece of detailed information about bitcoin trading.Thank you for reading this post, don't forget to subscribe!
This is because Terra-Luna coins were designed to work the same way every time. The CEO and co-founder of Terra Labs, Do Kwon, has finally talked about the Terra-Luna stable coins going down. The Chief Executive Officer is trying to find a way to make Terra a better place than it is right now.
It’s important to know that the company’s CEO has come up with a second plan to help the company get back on its feet. Kwon’s first idea, which he put forward on May 14, was to give everyone in the community Luna tokens and give up on the Terra stable currency. This plan didn’t work out, though. On the other hand, Kwon doesn’t seem to be ready to give up on Luna-Terra just yet.
It seems likely that the founder would fix problems with how Terra is put together. When there is a “hard fork,” all transactions on the blockchain network are confirmed, not just the ones in bad blocks. But how is this going to help?
With the new plan, Terra will not be linked to the Terra blockchain that already exists. Terra will instead be connected to a new blockchain. After that, the Terra token can be traded for the stable coin TerraClassic, which was made by Terraform laboratories and is not based on an algorithm.
The CEO of Binance, Chengpeng Zhao, has said that he doesn’t agree with the hard fork strategy. He said that the token shouldn’t be sold to investors but should be thrown away. Sending cryptocurrency to a “dead wallet,” from which the tokens can never be taken back, is called “burning.” This could help keep the amount of money in circulation steady.
The governance vote to build a new Terra blockchain with new LUNA coins, according to a report from Crypto Briefing that came out on Wednesday, was successful. On Friday of this week, the new blockchain will start to work.
In the past few weeks, a lot of pressure has been put on LUNA, which has caused its price to drop dramatically and its market capitalization to drop to almost nothing.
Do Kwon’s plan to bring life back to Terra’s biosphere seems to be going in the right direction?
The plan of the co-founder and CEO of Terraform Labs to build a new Terra blockchain was approved in a governance vote on Wednesday.
About 65.5% of the votes were in favor of the idea, and only 13.2% were “no with veto” votes, which meant that the person was totally against the idea. This made the proposal fall short of the veto threshold by 20.2%, which would have made it invalid.
This was done as a direct response to the collapses in Terra earlier this month, which cost $40 billion. Kwon came up with the plan to bring the dead back to life, which is supported by both Terraform Labs and the Terra Builder Alliance. The plan calls for the creation of a new blockchain and a new LUNA coin.
The old version of the Terra network was linked to an algorithmic stable coin, but the new version will not be. Some people think it should be called Terra. If the idea is accepted, the previous chain that crashed to zero would be renamed Terra Classic.
An airdrop of more LUNA tokens based on a fixed distribution is part of the plan for Terra to compensate investors who held both LUNA and UST before and after its collapse.
The staked government will have control over 30% of the new LUNA supply, and ecosystem developers will get 10%.
The remaining 70% will be given as an airdrop to people who own LUNA, UST, and aUST. aUST stands for UST tokens that have been staked in the Anchor Protocol from Terraform Labs. Anchor Protocol is a product used for lending. Investors were able to join the network because it promised returns of up to 20% per year (APY).The Anchor Protocol stopped working when Terra broke down. LUNA tokens that are created as a result of the airdrop will go to Terraform Labs, according to the current plan. As the token starts to make up for its losses, the price of LUNA goes up.