Terra Luna Classic's Journey to $1 with Market Swap Reopening for LUNC and USTC

Bombolo | News and Media

In the wake of the 2022 Terra-LUNA crisis, the Terra Luna Classic community is currently deliberating the possibility of reinstating the LUNC and USTC market swap function. This feature had been temporarily disabled in response to the crisis, but recent developments have sparked a renewed interest in its revival.

Also Read: The Terra Luna Classic Community's Move Towards Reopening LUNC and USTC Market Swap

The Dilemma: To Limit or Not to Limit

The L1 core developer team initially chose to abstain from implementing a limiter, as proposed by the USTC repeg team. Their primary concern was the potential adverse impact such a limiter might have on rewards, delegates, validators, and the community pool. The decision, while prudent, left the community searching for alternative solutions.

A Community Member's Ingenious Proposal

Enter Igor Veras, a Terra Luna Classic community member who has put forth an ingenious proposal to reactivate the LUNC and USTC market swap. Veras's proposal involves selectively applying the limiter only to the market swap, allowing for the release of the mint without restrictions for validators, delegates, and the community pool.

Veras's idea has been put to the test, with the code being rigorously examined within a test environment created by the L1TF developer team. The expected outcome of implementing this method is a significant increase in LUNC burns, a crucial step towards achieving the community's vision of USTC repegging to $1 and Terra Luna Classic (LUNC) regaining its value at $1.

Also Read: Terra Luna Classic Price Predictions for August, September, and October 2023

The Impact on Utility and LUNC Burns

Enabling the market swap function is poised to have a substantial impact on Terra Luna Classic. Notably, it will lead to a reduction in both LUNC and USTC supply, aligning with the goal of USTC repegging. Furthermore, it will enhance utility by facilitating the creation of pairs in Terraswap or Astroport, two significant platforms within the Terra Luna ecosystem.

However, it's essential to acknowledge that the LUNC burn rate has experienced a decline since July, despite the existence of Binance's LUNC burn mechanism. Terra Luna Classic has undergone updates and attempted to achieve parity with little success, resulting in prices falling below multiple support levels.

Currently, the LUNC price hovers at $0.000061, marking a decline of nearly 5% over the past week. Within the same timeframe, the 24-hour low and high were recorded at $0.0000611 and $0.0000636, respectively.

In conclusion, the Terra Luna Classic community finds itself at a crossroads, contemplating the revival of the LUNC and USTC market swap function. Igor Veras's proposal offers a promising solution, one that could potentially revitalize the ecosystem, boost utility, and align with the community's vision of price stability. As Terra Luna Classic navigates these challenges, it's evident that the future of the ecosystem remains both dynamic and full of potential.

Also Read: Bearing Witness to Terra Classic: The Price Forecast as 5 Billion LUNC Tokens Are Unstaked

FAQs

1. Why was the LUNC and USTC market swap function initially disabled?

The market swap function was temporarily disabled in response to the 2022 Terra-LUNA crisis to mitigate potential risks and impacts on various aspects of the ecosystem.

2. Who is Igor Veras, and what is his proposal?

Igor Veras is a Terra Luna Classic community member who proposed a selective application of the limiter only to the market swap, allowing for the release of the mint without restrictions for validators, delegates, and the community pool.

3. How will the reactivation of the market swap function affect LUNC and USTC supply?

Enabling the market swap function is expected to significantly reduce both LUNC and USTC supply, aligning with the goal of USTC repegging to $1.

4. What impact does this have on utility within the Terra Luna Classic ecosystem?

The market swap reactivation will enhance utility by enabling the creation of pairs in platforms like Terraswap and Astroport.

5. What challenges has Terra Luna Classic faced in recent times?

Despite efforts to stabilize prices and boost the ecosystem, Terra Luna Classic has experienced a decline in the LUNC burn rate and struggled to maintain price levels, falling below support thresholds.