It seems like an eternity ago that the Terra ecosystem collapsed in spectacular fashion in May this year. In that implosion, 40 billion dollars in wealth was lost and a lot of dreams shattered. Meanwhile, a group of enthusiasts has been working on the resurrection of Terra for some time now in the form of Terra LUNA Classic (LUNC).
Binance and LUNC
After Terra’s collapse, LUNA’s supply has exploded. That’s an issue that LUNC still struggles with today. To reduce the token supply to a more acceptable number, the community has come up with a transaction tax. Every blockchain transaction is subject to a 1.2 percent tax that is sent to the digital pyre. That LUNC will then disappear from circulation forever.
The problem is that transactions on exchanges are not caught by this. For that reason, the community has tried to persuade exchanges to also charge 1.2 percent tax on transactions and then burn them. Binance is now participating, but in its own way. “We are going to build in an ‘opt-in button’, with which people can voluntarily choose to participate in the 1.2 percent tax”, thus Binance CEO Changpeng Zhao.
Tax does not start immediately
If you choose to pay the 1.2 percent tax on LUNC trades on Binance, it will not take effect immediately. Only when 25 percent of the investors activate the tax, it will apply to all yes-clickers. When this percentage reaches 50 percent, the tax will be applied to everyone who trades in LUNC. Much therefore depends on the community, which largely controls this part itself.
Binance therefore wants to put the reins in the hands of the community, a way of thinking that is in line with the crypto ethos. “We listen to our users and try to protect them,” said Changpeng Zhao. However, Binance’s CEO also realizes that many users are likely to switch to other exchanges to trade LUNC if Binance suddenly charges a 1.2 percent tax.
