After an uncertain last week and with LUNA’s price dropping below 1 cent, Do Kwon, the founder of Terra Luna, announced a new revival plan on Twitter. A new governance proposal #1623 suggests renaming the existing network to Terra Classic, renaming LUNA to LUNA Classic, and birthing a new blockchain. The full proposal can be viewed on Terra’s official Agora forums titled Terra Ecosystem Revival Plan 2.
Published on May 16th by Do Kwon himself, the new revival plan suggests creating a new Terra chain without the algorithmic stablecoin. The old chain will be called Terra Classic (LUNC), while the new chain will be called Terra (LUNA).
In addition, LUNA tokens will be airdropped across Luna Classic stakers, holders, residual UST holders, and several app developers of Terra Classic.
The official proposal on Agora outlines specific details regarding token distribution and additional technical information. The proposal currently features over 122k views with over 2.8k replies with overall positive responses.
Do Kwon also mentioned that the current proposal has broad support from Terra builders, tagging over a dozen community members and developers in his Twitter post.
If the proposal is successful, the final snapshot will be taken on May 27th, and a new network will be born by the end of the month.
For those who have been in cryptocurrency for a few years, remember the Bitcoin Classic vs. Bitcoin war that happened due to a similar fork in the network when the community disagreed about the future of the BTC network, precisely the block size.
If LUNA splits into the classic and new chains, it could confuse both projects, especially for new traders/investors who don’t follow crypto developments so closely.
Another solution that could save the LUNA blockchain is burning most of the tokens, thereby reducing the supply significantly. This will avoid the creation of a fork and new chains, and LUNA will remain with a single blockchain.
Burning LUNA has tremendous support, especially on Twitter where the hashtag #BurnLuna was trending earlier today.
In response to Do Kwon’s announcement on Twitter today, LUNA’s price is up over 7%, currently trading at $0.0001887.
UST is down 21%, currently trading at $0.09. It comes as no surprise that UST continues to trend downwards because the new proposals don’t address a solution to repeg the stablecoin as the new network will operate without it. In addition, the Luna Foundation Guard disclosed that most of its UST reserves have been depleted and it plans to utilize the rest of the funds to reimburse UST holders.
LUNA’s market cap is currently still trading well above $1 billion, with a 24-hour trading volume also surpassing $1 billion in the past 24 hours. Many traders purchased LUNA last week in the hopes of catching the cryptocurrency rebound, only to lose 99% of their holdings.
Even with the current new revival plan, consider that LUNA is exceptionally overvalued with a current market cap of $1 billion. LUNA’s stablecoin was its main selling point, and without UST, LUNA’s valuation will struggle to stay at $1 billion.
Disclosure: This is not trading or investment advice. Always do your research before buying any cryptocurrency.
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