According to Rex, the project’s primary objective is to attract investments into LUNC and simultaneously expedite burns.
Rex “Rexyz” Harrison, Terra Classic developer and senior member of the LUNC development group TerraCVita, has highlighted the ultimate goal of the much-anticipated Terraport project for the LUNC ecosystem. According to him, Terraport will help introduce investments into LUNC and concurrently expedite token burns. The project is expected to launch in Q1 2023.
The prominent Terra Classic community member outlined these objectives in an elaborate tweet yesterday. He disclosed that the primary objective of Terraport is to attract investments into LUNC by introducing a decentralized exchange (DEX) that will allow investors to swap other tokens to LUNC easily. The DEX will do this by creating appropriate trading pairs.
1/ Why we need @_Terraport_? 🧵
The primary purpose of #Terraport is to create a sustainable DEX to create trading pairs to make it easy for investors holding other tokens to swap with #LUNC thereby attracting investment into $LUNC.
For a DEX to work it requires liquidity.
— Rexyz (@RexYellerBelly) February 9, 2023
Rex disclosed that TERRA, the Terraport project’s native governance token, is to provide liquidity for the decentralized exchange because “for a DEX to work, it requires liquidity.” Exchanges usually offer governance tokens or other native assets to attract liquidity. By employing a governance token, TERRA, Terraport gives investors the option to either support the DEX or not.
According to him, relying solely on community funding or the Oracle could result in dissatisfaction among those who do not support the project, potentially leading to failure and undermining efforts. The approach gives investors the freedom to choose whether to be part of the project.
Moreover, Terraport minimizes risk on the Terra Classic Oracle Pool, as several proponents remain uncomfortable with that. Concerns of the Oracle Pool running out in 2 years had surfaced, with Terra Classic developer Edward Kim debunking them last December. The LUNC and USTC holdings of the Pool currently have a combined value of £740.6M.
The Success of Terraport will Attract More Builders
Further, Rex pointed out that by creating a deflationary token and sharing profits from the DEX, Terraport will reward those who provide financial support. Additionally, investors holding LUNC will benefit from Terraport’s deflationary effect as it burns LUNC. Being a Crypto Collectible Standard 20 (CW20) token, TERRA is built on Terra Classic and developed in-house, making it a self-grown project. CW20 is a token standard on Terra.
Rex believes that if Terraport can create more LUNC trading pairs, it will increase the token’s accessibility, attracting more volume. Terraport was also previously teased as an avenue through which on-chain volume on Terra Classic can be augmented.
The success of Terraport and Terra Casino will demonstrate to the broader cryptocurrency community the potential of building on Terra Classic, which is essential for the network’s future success. Positive results will attract more builders to the network, thereby introducing further utility that should support LUNC’s value.