The co-founder wants to hard fork Terra in order to start again because he has given up trying to fix UST’s peg.
Do Kwon, a co-founder of Terra, has revealed a revitalization strategy for the Terra community that would completely do away with the UST stablecoin. Instead, he advises validators to fork the chain, reset network ownership under a new token, and distribute it to appropriately recompense all harmed parties.
Do Kwon claims that UST has failed.
Kwon said in a forum post on Friday that Terra (LUNA) has been diluted to the point that its combined ecosystem with TerraUSD (UST) cannot be recreated, even if the peg for UST somehow stabilizes.
LUNA was a governance token that supported UST’s peg, and UST was formerly the third-largest stablecoin tied to the US dollar. This week, the value of each coin has decreased by 84% and 99%, respectively.
The co-founder asserts that UST can no longer function as the “decentralized money” they intended for since the crash has so completely destroyed faith in it.
Although UST has dominated Terra’s development story for the past year, Kwon said that what is truly important to protect is the ecology and the community there.
Due to the nearly 6 trillion LUNA tokens now in circulation, the author suggests forking the chain and resetting network ownership to only 1 billion tokens.
Paying the Terra Community Compensation
At the moment that UST initially de-pegged this month, 400 million of the Terra fork’s tokens were to be issued to previous LUNA holders. Terraform Labs will be excluded from this though, as Kwon wants the new chain to be “community-owned”.
In order to compensate UST holders for retaining Terra’s debt, an additional 400 million tokens will be sent to them at the time of the upgrade.
The next 100 million will be distributed to LUNA’s final holders before the Terra chain was terminated, with the remaining 10% going to the neighborhood pool.
Kwon asserts that the Terra community will discover a different way to use “decentralized money” in the future to replace UST.
He said, “I hope the community can quickly come to an agreement on how to restore the Terra ecology. I’ll be around forever.
The proposed proposals represent a sharp departure from Kwon’s initial UST recovery strategy, which called for accelerating UST burn rate.
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