LUNC Community Puts USTC Repeg Ideas into Practice Via L1JTF

  • The embattled LUNC community has witnessed several USTC repeg proposals.
  • Terra Classic USD (USTC) still trades below $0.015, LUNC inks 1.5% daily gains.
  • L1JTF proposes a test environment specifically geared towards repeging USTC.

The Layer-1 Joint Task Force, a developer team made of Terra Luna Classic (LUNC) holders, has decided to take control of the USTC repeg initiative. Three days ago, the L1 Task Force penned a new proposal on Agora to create a simulation of the malfunctioning stablecoin USTC repeg. 

How Would USTC Test Environment Work?

The L1 Task Force is eager to experiment with several ideas described in the Terra Classic network proposals. Firstly, the facilitation of USTC repeg could come with penalizing USTC holders for selling the asset below its assumed peg at $1.

Moreover, another USTC repeg proposal suggested creating a special staking vault. With implied divergence fees on trading, USTC staking could be used to reduce the supply of the malfunctioned stablecoin. Finally, after Terra Classic USD (USTC) is back at the $1 peg, LUNC member Redline Drifter offers to create a liquidity pool between USTC and LUNC. 

Other creative ideas to help revitalize the deteriorated Terra Classic blockchain proposed by the members include burning $LUNC and an AI chain app, which would substantially boost Terra Luna Classic’s utility.

Besides, the L1 Task Force team explained that no extra funds would be required to set up a USTC test environment – the previously passed proposal #11462 took care of that. According to the previous proposal, the Joint L1 Task Force team received $124,000 in development funds for work on LUNC’s L1 in Q2 of 2023.

On the Flipside

  • Many LUNC community members are opposed to the divergence fees, as it’s unlikely that major exchanges would accept it.
  • LUNC 0.5% burn tax proposal was passed, even though the initiative’s opponents threatened to leave the network.

Why This Matters

The infamous Terra Luna network crash in May 2022 had market-wide consequences. Restoration of the USTC stablecoin could help bring back mass appeal to the network.

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Written by on 2023-05-26 14:30:00.

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