Binance Declares Support for Terra Proposal to reduce LUNC and USTC Tax Burn Parameters.
The exchange has continued to foster its support for the Terra Classic project.
— Binance (@binance) October 19, 2022
Binance, the world’s largest exchange by trade volume, has announced that it will comply with the recent proposal 5234 passed by the Terra community to reduce the tax burn for LUNC and USTC on-chain transactions.
As reported by The Crypto Basic, the proposal to reduce the tax burn for all LUNC and USTC on-chain transactions from 1.2% to 0.2% was passed yesterday and will be implemented today at 12:50 UTC. Based on this, Binance will also implement the changes for all LUNC and USTC deposits and withdrawals on its platform.
The world’s largest exchange noted that it would reduce the consolidation fee for all Terra classic tokens to 0.2% from its previous parameter of 1.2%. Furthermore, the consolidation fee for USTC and LUNC withdrawals will also be reduced from 1.2% to 0.2% once the proposal is implemented.
Binance added that both deposits and withdrawals of Terra classic tokens will still incur the exchange’s normal fees.
Move to Boost Terra Classic Volume
Recall that the Terra Classic community passed proposal 5234 yesterday following a week of voting. The proposal was launched based on the massive USTC and LUNC trading volume decline. Members of the Terra Classic community believed the 1.2% tax burn levied on all on-chain transactions for LUNC and USTC contributed to pushing many investors away from the assets.
Many believe reducing the tax for LUNC and USTC will boost the cryptocurrency’s trading volume and increase the number of tokens burnt by exchanges.
As revealed in the proposal, 10% of the 0.2% tax burn for LUNC and USTC on-chain transactions will be allocated to the community pool to fund development activities. The announcement marks the latest support Binance has made to the Terra Classic community.