Terra Founder Wants An Airdrop For Affected LUNA and UST Holders, But the community doesn’t think it’s a good idea.
The ghosts of failure are still battering Terra Luna, but it seems that the project team has finally thought of a way to pull the coin out of the trenches.
According to a recent Twitter update by Do Kwon, there’s a plan to fork LUNA and airdrop it to the stakeholders.
Also, TFL’s wallet will be removed from the airdrop, making Terra a fully community-owned chain.
— Do Kwon 🌕 (@stablekwon) May 16, 2022
Technically, this would create a whole new cryptocurrency and still leave the old one in place. Do Kwon proposes that the new coin be named Terra without the algorithmic stablecoins, while the old network/chain will be called Terra Classic.
As such, there will be the new LUNA and the old LUNA Classic (LUNC). The two chains will run in co-existence. Once the fork is done, the new LUNA will be airdropped to old LUNA users as well as UST holders. Terra’s wallet (Terraform wallet) will also be deactivated to make the Terra chain fully owned by the community.
“The Terra chain as it currently exists should be forked into a new chain without algorithmic stablecoins called “Terra” (token Luna – $LUNA), and the old chain is called “Terra Classic” (token Luna Classic – $LUNC). Both chains will coexist.”
313 BTC And $383 Million Worth Of Crypto
According to an update by the Luna Foundation Guard, the foundation held over 80,000 BTC at the start of May. It also held a collection of other cryptos including BNB, UST, AVAX, LUNA, USDC, and USDT. However, as of now, there are only around 313 BTC left.
During the crypto crash, the foundation had undertaken an aggressive sell-off to prop up UST. However, this doesn’t seem to have worked since the coin is still down by huge margins losing its Dollar peg.
Despite the small BTC stash left, the LFG still has a total of around $383 million worth of cryptos. These will be used to compensate affected users, stakers, and holders as the forking plan take effect.
Critics Say “This Won’t Work”
While Do Kwon’s plan to fork LUNA may seem to be a relief to many who have been waiting for him to develop an action plan, there are those in the crypto space who aren’t exactly receptive to it.
One of these is the Binance CEO, and another one is the Dogecoin co-founder Billy Markus. Binance CEO argues that creating a fork doesn’t accord the new coin any more value than the collapsed one. He called the attempt “wishful thinking.” The CEO had earlier slammed the Terra team for being sloppy in handling the crypto crash.
Personal opinion. NFA.
This won't work.
– forking does not give the new fork any value. That's wishful thinking.
– one cannot void all transactions after an old snapshot, both on-chain and off-chain (exchanges).
Where is all the BTC that was supposed to be used as reserves? https://t.co/9pvLOTlCYf
— CZ 🔶 Binance (@cz_binance) May 14, 2022
On his part, DOGE creator Billy Markus doesn’t think creating a LUNA fork is a smart move at all. He sees it as a venue for people to lose even more money.
“the plan is actually fu.king stupid, the only way it works is for a massive amount of even stupider people want to throw their money in a dumpster fire to save one of the dumbest things to ever happen in crypto.”
oh wow. impressed.
just to +1, the plan is actually fucking stupid, the only way it works is for a massive amount of even stupider people want to throw their money in a dumpster fire to save one of the dumbest things to ever happen in crypto
— Shibetoshi Nakamoto (@BillyM2k) May 14, 2022