A new proposal to allocate 50% of all LUNC burns to the community pool to fund on-chain development has sparked outrage in the LUNC community.
Yesterday, @reXxTerraRebels, AKA reXx, brought the community’s attention to a new proposal that will allocate 50% of all token burns to the community pool to fund development currently up for voting on the Terra Station.
Proposal #10983 is up on Terra Station to be voted on.
— reXx™ (@reXxTerraRebels) November 30, 2022
Notably, community influencer Classy also shared the proposal hours later. But, like reXx, he refrained from giving an opinion on it.
Cosmos Capybara, a Cosmos validator, authored the proposal. The proposal with ID 10983 asserts that the community pool is grossly underfunded and threatens the community’s ability to fund high-cost development activities. Consequently, Cosmos Capybara believes the correct action is a parameter change allocating 50% of all Terra Luna Classic (LUNC) and TerraClassicUSD (USTC) burns to the community pool at the end of every epoch.
Per the proposal, the community could have allocated 400% more to the community pool at the end of the last epoch from November 21 to November 28 with this parameter change. Cosmos Capybara argues that the community needs a well-funded community pool if it plans to remain self-reliant.
The Terra Classic Community Does Not Look Pleased
Judging by the comments, most Terra Classic community members are firmly against it. For example, one user threatened to delegate his tokens elsewhere if his validator voted “yes.”
For some, the primary concern is the impact on the already slow rate of LUNC burns as the community faces the imposing task of reducing the over 6 trillion LUNC supply. Others are concerned that the proposal threatens to jeopardize the community’s relationship with Binance and other independent supporters who burn LUNC tokens. Instead, many believe that the network should tax validator commissions.
However, it bears mentioning that the reception was not all bad. For example, one user highlighted that the Terra Rebels would soon move to a paid working model, a development previously reported by The Crypto Basic. Accordingly, he argues that it is necessary to fund the pool so the community can fund development activities when the time comes.
The decision on how the community plans to fund development is potentially pivotal to the continued progress of the network. Ultimately, quality developers are unlikely to continue to work indefinitely for free. Without an environment that supports increased utility, the lofty goals of the community stand the risk of falling flat.
Developers’ funding remains the subject of intense community debates. Notably, the current burn tax parameter model allocates 10% of all LUNC burns to the community pool.