Terra Classic community has started showcasing their determination to burn tons of LUNC tokens, in order to massively reduce the circulating supply of the embattled digital asset. Since it’s generally known that the scarcity of an asset commonly boosts its chances of becoming more valuable, only a LUNC burn mechanism can help victims recover a portion of their losses.
3.08 Trillion LUNC Burned So Far
According to LUNC Burn, a channel that tracks all LUNC tokens sent to the inferno wallet (terra1sk06e3dyexuq4shw77y3dsv480xv42mq73anxu), a total of 3,080 billion LUNC tokens have been destroyed so far.
LUNC Burn reported, “Total burned LUNC stands at 3,080 billion. The volume traded in the last 24hrs is $157m, 1.2% of that is $1.88m at these prices and volume we would have burned 14.6b LUNC.”
🚨🚨 total burned $Lunc stands at 3,080 billion🚨🚨
— LUNC Burn (@LunaBurn_13) August 25, 2022
What Does 1.2% Tax/Burn Represent In LUNC Burn Initiative?
After the collapse of the Terra ecosystem, which led to the crash of Terra (LUNA), a new chain was created, and the old chain token was renamed Terra Classic (LUNC).
Prior to the emergence of the new Terra blockchain dubbed Terra 2.0, a large number of community members clamored for a massive burn of LUNA tokens. Even the CEO of Binance exchange, Changpeng Zhao (CZ), advised Do Kwon and his team to opt for LUNA massive burn. CZ believed that the creation of a new chain will not help the price, but Do Kwon’s mind was already made up.
The launch of Terra 2.0 produced a new token codenamed LUNA 2.0. Some members of the community were airdropped, while a ton of others chose to hold their LUNC, believing that Terra Classic still can be revived through a token burn mechanism.
A few days after the new token was launched, the determination of those who believed in LUNC gave birth to a new burn proposal that suggested a frank LUNC burning mechanism.
According to the content of the proposal, a 1.2% tax/burn will be implemented on all LUNC transactions (buys and sells). This implies that 1.2% of tokens bought or sold will be burned, which will drastically and continuously reduce the LUNC supply. This is also expected to ignite a significant increase in demand.
In the proposal, it’s also stated that the burning mechanism will be stopped once the LUNC Supply reaches 10 billion tokens. It’s believed that at this level, LUNC will be scarce enough to fight for recovery.
Although the digital asset is still very far from where it was trading before the historic crash, a massive and continuous burn could greatly help in recovering a portion of its losses.