The Terra community has opposed Terraform Labs CEO Do Kwon’s proposal to fork Terra to create two blockchains to make up for last week’s real-time collapse of UST.
Instead of a blockchain fork, the community favours an aggressive burning mechanism to revive the Terra ecosystem. Most investors also claim that the Terra team does not listen to the community and is hell-bent on defending whales rather than smallholders.
Terra Users Reject Do Kwon’s Proposal To Fork LUNA
The CEO of Terraforms Labs, who is founded to be co-founder of a previously failed stablecoin project, is not willing to give up. On Monday, he wanted to split LUNA’s blockchain into two chains, Terra Classic and Terra. They will host the cryptocurrencies Luna Classic (LUNC) and Luna (LUNA), respectively.
As CoinCulture reported earlier, the new chain will eliminate the troubled UST algorithmic stablecoin and concentrate on decentralised financial (Defi) applications. The present chain would remain as Terra Classic, and LUNA token holders would get an airdrop of the new network’s token. Terra will be community-owned since Terraform Labs will not participate in the airdrops.
Even though official governance voting will not start until May 18, early voting by community members indicates a formidable opposition to forking the blockchain. There have been more than 2,747 votes cast on Terra’s research and governance forum, with 90% voting against the forking. One member of the community said, “No one wants a fork.” Only 10% of voters supported the move.
Let’s see what the #LUNA community really wants. Please retweet this and let it spread wide and far. @stablekwon proposed a fork for a terra 2.0, but many want a burn.
What do the #LUNAtics want?— MuchPumps Doge & LUNA Army (@muchpumps) May 17, 2022
Most Terra users are dissatisfied with how events transpired for LUNA and UST, but they fear that creating a new blockchain would only benefit whales while retail investors are burnt.
Additionally, Binance CEO Changpeng Zhao has advocated burning and repurchasing as promising strategies to safeguard the ecosystem. According to CZ, “Minting, forking, don’t create value. Buying back, burning does.”
Do Kwon Was Requested To Explain Terra Meltdown
In the last week, crypto markets have been under pressure due to the meltdown of TerraUSD. Amid the declining price of UST at the beginning of last week, Luna Foundation Guard (LFG) said that it would dispose of its bitcoin reserves and buy UST.
In addition to provoking resentment among distressed investors, the steep decline has increased the number of governments and legislators advocating for stricter crypto legislation.
According to a local journal, the South Korean Conservative Party is now requesting a parliamentary inquiry on the Terra scandal. Specifically, the Political Affairs Committee of the National Assembly requested Do Kwon to appear at a hearing.
Yoon Chang-Hyeon, the committee’s spokeswoman, raised many queries about the uncoordinated exchange conduct during the Terra meltdown. Coinone, Korbit, and Gopax, for instance, ceased trading UST and LUNA on May 10, although Bithumb and Upbit waited until May 11 and May 13, respectively, to suspend trading these tokens.
The government can do nothing right now without laws and regulations to safeguard investors. Yoon has proposed summoning exchange officials and Kwon before the National Assembly to determine the true reason for the decline and propose corrective actions to protect investors.
Consequently, the Terran community has an uphill struggle. It remains uncertain whether the historic collapse proves to be “a chance to rise up anew from the ashes” as Kwon stated earlier.
