The Terra Classic community is weighing a proposal that requires Binance to burn a portion of its USTC trading fees, alongside other measures to repeg the USTC stablecoin.
Since the infamous Terra collapse in May 2022, community members have consistently sought measures to recoup their investments and potentially help the project regain its once-prestigious status in the cryptocurrency ecosystem.
A pair of new proposals on the Terra Classic governance forum represent the latest of such efforts.
One of the proposals (#11785) hopes to implement new measures to help the grossly depegged TerraClassicUSD (USTC) stablecoin regain parity with the US dollar. In a nutshell, the proposal hopes to compel leading cryptocurrency exchange Binance to burn 50% of the trading fee it receives from USTC trading pairs on the platform.
Recall that Binance already burns 50% of the monthly trading fee it accumulates for Terra Classic (LUNC) pairs. Thus, the current move seeks an extension of this provision to USTC pairs, with Binance offering USTC/USDT and USTC/BUSD trading. These pairs had a combined trading volume of around $5 million in the past 24 hours.
Proposal #11785 argues that having the world’s largest crypto exchange burning a portion of the USTC supply would help in the campaign to re-peg the stablecoin and potentially raise the value of LUNC.
Such a move would also likely encourage other exchanges to do the same, bringing “big benefit to investors that hold either USTC or LUNC,” the proposal claims.
At the time of writing, 40.74% of voters favor Binance introducing a USTC burn program. However, 57% of voters chose to abstain, with just 1.87% directly voting against the move.
Community members in favor of Binance burning USTC will hope the proposal gains 4.4% of the participation still required for it to reach quorum and additional votes in its favor.
Related Proposal to Limit USTC Minting
Another proposal currently up for a vote on the Terra Classic governance (#11786) seeks to limit USTC minting. The move would leave any USTC minting offer open to community voting and close loopholes that increase the stablecoin’s supply.
At press time, the proposal remains hotly contested, with its future likely impacting the related proposal for Binance to burn USTC. 47.32% of votes favor the minting limitations, while 44.34% are against the move.
Regardless of the outcome, the Terra Classic community’s efforts to re-peg USTC’s value back to the USD represent a hugely ambitious mission. The collapsed stablecoin trades at $0.012, gaining 1% in the past 24 hours.