There has been a massive increase in the on-chain volume on the Terra Classic network following the approval of the LUNC burn tax reduction proposal, which was implemented by Binance on the 19th of October 2022.
Recall that the proposal was introduced to make a parameter change to the formerly effective 1.2% LUNC tax on on-chain transactions.
It’s worth noting that the implementation of the 1.2% tax on all transactions has made LUNC on-chain volume experience a devastating drop. This brought about the tax burn reduction to 0.2% as earlier suggested by Changpeng Zhao, the CEO of Binance.
Terra Classic (LUNC) On-Chain Volume Doubles
As reported a couple of hours ago by a crypto influencer known with the Twitter account @ClassyCrypto_, the burn tax change is already paying off as LUNC saw a double (over 100%) of its on-chain volume on the first day of the implementation.
Captioning the chart of the increase, @ClassyCrypto_ wrote, “The .2% LUNC burn tax change has already increased volume on-chain by 2x on Day 1. Retweet to spread the word!”
The .2% $LUNC burn tax change has already increased volume on-chain by 2x on Day 1.
Retweet to spread the word! 🔥🔥🔥 pic.twitter.com/eWiWC4wGrH
— Classy 👾 (@ClassyCrypto_) October 20, 2022
Reacting to the update, Duncan Day, a member of the TerraRebels group and the author of the newly approved proposal, said it’s too early to know the effectiveness of the $0.2% tax burn on the on-chain volume. He said a period of seven days is needed to have a correct evaluation.
Duncan Day tweeted, “Gentle reminder that we need to measure this 7-days post-tax to give a reasonable assumption that it has increased volume on-chain. Given that I found 7-days enough to determine burn tax efficacy, it is only fair to give the same objective viewpoint here.”
Although the impact is already seen on the volume, LUNC burn has not benefitted from the tax parameter change. Instead of rising, LUNC burn saw about a 17% drop on October 19.
The drop became obvious on October 20. On this day, Terra Classic burn declined by about 69%, according to data from LUNC Burner.
It should be noted that the Terra Classic community may come up with another proposal if the current one fails to achieve the desired goal.
Follow us on Twitter, Facebook, Telegram, and Google News
