The exchange could choose to implement the 1.2% tax on all LUNC spot and margin trading.
Binance, the world’s largest exchange by 24 hours trading volume, has responded to criticism over its refusal to implement the 1.2% tax burn on Terra Classic Network tokens, LUNC and USTC, for spot and margin trading.
In response to the widespread criticism, Binance said it only followed the instructions in the proposal, which requires a 1.2% tax burn for on-chain transactions like deposits and withdrawals. The world’s largest exchange noted that most of its transactions are settled off-chain, thus making it difficult to levy the 1.2% tax.
However, Binance remarked that it would monitor the effects of the recent changes to ascertain whether to review its decision and levy the tax on spot and margin trading of the Terra Classic Network tokens.
“Hi! We introduced a 1.2% tax burn for on-chain transactions exactly according to the proposal. We settle most transactions off the chain and this makes it difficult for the tax to be levied. Yet, we would closely monitor the effect of the change and might review the decision.”
Hi! We introduced a 1.2% tax burn for on-chain transactions exactly according to the proposal. We settle most transactions off the chain and this makes it difficult for the tax to be levied. Yet, we would closely monitor the effect of the change and might review the decision.
— Binance Customer Support (@BinanceHelpDesk) September 9, 2022
Terra Investors Angry With Binance’s Decision
Earlier this week, As reported by The Crypto Basic Binance said it would join other cryptocurrency exchanges to implement a 1.2% tax burn for all on-chain transactions of Terra Classic tokens, including LUNC and USTC. The exchange noted that the decision would only apply to deposits and withdrawals, while spot and margin trading would be left out.
Binance’s decision not to levy the 1.2% tax burn for spot and margin trading has brought the exchange to be criticized by aggrieved Terra investors, who want the tax to be effected on spot and margin trading.
LUNC DAO, a Terra community Validator, expressed disappointment in Binance founder Changpeng Zhao for not implementing the 1.2% tax burn for spots and margin trading of LUNC and USTC.
It is noteworthy that the 1.2% tax burn proposal is seen as the perfect way by LUNC and USTC holders to get compensated for the losses they incurred in May 2022.
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