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The Terra Classic community is preparing for a supply shock that the LUNC coin could soon face. This is based on a court settlement that has mandated Terraform Labs to burn the tokens in their possession.
Court Orders LUNC Burn As Part Of Terraform Labs Settlement
Terraform Labs is set to carry out LUNC burns as part of its $4.5 billion settlement with the US Securities and Exchange Commission (SEC). These burns must be carried out before the end of this month, or Terraform Labs will have to pay a fine. According to the SEC, the crypto firm must burn or destroy private keys in its possession of wallets holding these LUNC coins.
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Based on the deadline, the LUNC burn may occur this week. Ahead of the burn, Terra Classic community members have also been told to withdraw their assets locked on the Shuttle Bridge, as it will also be closed during the LUNC burn and never be opened again.
Terraform Lab’s imminent LUNC burn is undoubtedly a positive for the coin, as this could provide much-needed bullish momentum and lead to a significant price surge. Moreover, this aligns with the Terra Classic community’s mission to remove as many coins as possible from circulation to revive LUNC.
They believe this deflationary mechanism could help send the coin back to its current all-time high (ATH) of $119. LUNC Metrics data shows that 135.54 billion coins have been burned since these token burns began on May 13, 2022. Meanwhile, 303.6 million coins have been burnt in the last seven days. However, the community still has a lot of work to do, considering that LUNC still has a circulating supply of 6.76 trillion.
Other Steps Taken By The Terra Classic Community
In addition to LUNC burns, the Terra Classic community has taken other steps to help revive the coin and restore it to its glory days. This includes developing proposals to improve the LUNC ecosystem and promote the coin’s adoption.
The most recent proposal is from OrbitLabs to remove the forked mainline modules from the Terra Classic blockchain. The proposal states that this will help improve maintainability, reduce technical debt, and align with the broader Cosmos ecosystem.
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OrbitLabs further highlighted the current situation in the LUNC ecosystem to show why this proposal is necessary. According to them, the Terra Classic codebase uses several forked versions of Cosmos modules to accommodate its unique features. This has led to the codebase diverging from the upstream modules and increasing maintenance costs.
Therefore, this new approach will help ensure that the Terra Classic blockchain is current with the latest securities and features from the Cosmos development team. This will help massively reduce maintenance costs and time.
At the time of writing, LUNC is trading at around $0.0000925, down over 2% in the last 24 hours, according to data from CoinMarketCap.
Featured image created with Dall.E, chart from Tradingview.com
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