Terra Classic Core Developer Reveals The Key To Reduce LUNC Supply Efficiently

Zaradar believes that a faster LUNC burn will result from a combination of factors.

In a clip from a Terra Classic community Ask Me Anything session (AMA) with Tobias Andersen, AKA Zaradar, on October 23, shared today by the Terra Rebels, the developer discusses the key to more efficient Terra Luna Classic (LUNC) burns.

Zaradar does not believe it is a higher burn tax rate.

A small important recap of @ZaradarTR thoughts on increasing the burn rate for #LUNC. pic.twitter.com/Y7DllyWgZZ

— Terra Rebels (@TerraRebels) October 31, 2022

According to Zaradar, a Terra Classic core developer with the Terra Rebels, the key is a combination of factors that include bringing back economic activity to the chain, re-enabling swaps, generating taxes, and allowing people to pay smaller burn fees.

“It’s getting the economic engines running, again, getting the swap system running, getting people to generate taxes and pay smaller burn fees … because that will inherently end up burning things a lot faster,” said the developer.

While the developer asserts it would be slow for the first few years, he believes that if the chain can attract real-world use cases, the network could burn the excess LUNC supply almost at the rate the Terra ecosystem crashed in May (a matter of days).

“And I think, you know, it will probably be slow for the first few years,” said Zaradar. “But if we succeed … to reach some sort of tipping point in terms of real-world transactions on the network, eventually, that will start speeding up at a pace that might eventually equate to the crash itself, at least for a certain period of time.”

It is worth noting that the Terra Rebels hope to re-enable swaps on the network and eventually repeg the defunct TerraClassicUSD (USTC) stablecoin. As per statements from Zaradar during the AMA, Alex Forshaw and another Terra Rebels member, Max, are working to combine both USTC repeg proposals.

As reported by The Crypto Basic a week ago,  USTC will be the network’s reserve currency based on this plan. Notably, USTC’s algorithmic controls burn LUNC with greater adoption of USTC.

In addition, the Rebels are also taking steps to bring back utility to the chain. For example, the code to re-enable Inter Blockchain Communication (IBC) is ready. Per the report, aside from unlocking locked liquidity, with IBC channels reopened, other projects within the Cosmos ecosystem could adopt LUNC as a payment method to attract its active community.

Furthermore, the chain is also working to achieve technological parity with Terra 2.0. Consequently, it will be compatible with the Terra 2.0 decentralized applications (DApps), making the Terra Classic network appealing to these projects. 

The Terra Rebels launched its first Terra Classic DApp on Saturday, a lottery game that allocates 26% of its pool to the burn wallet.

The LUNC supply remains at over 6.8 trillion, with over 24 billion burnt in total and the tax burning 7.7 billion from that total.