Terraform Labs (TFL) has proposed a significant upgrade to the Terra blockchain, which includes a major token burn. This proposal, if approved, will mark the final chain upgrade under TFL’s direct oversight, as the company is set to wind down its operations.
The upgrade, known as Proposal 4818, aims to upgrade Terra’s mainnet to version 2.12.4. One of the key changes included in the proposal is the enforcement of a 5% minimum commission rate for validators, ensuring network integrity.
Token Burn and Community-Led Future
The most notable aspect of the proposal is the planned burning of TFL’s LUNA holdings. This token burn could have a significant impact on the price of both LUNA and LUNC, as it would reduce the circulating supply.
The proposal also addresses the issue of compromised wallets and illegally minted assets from the IBC exploit, ensuring that these assets are permanently removed from circulation.
With TFL’s departure, the future of the Terra blockchain will be increasingly reliant on community-led initiatives. The Phoenix Directive is poised to take over operational responsibilities and guide the network’s evolution.
Also Read: Terraform Labs’ Final Upgrade and Transition to Community-Driven Governance
Market Impact
While the proposal has garnered significant support from the community, the LUNA and LUNC prices have experienced a recent downturn. LUNA has declined by 3.83%, and LUNC has fallen by 5%. However, the community remains optimistic about the potential for a price rally following the implementation of the upgrade and the token burn.
Terra’s final upgrade under TFL’s oversight represents a significant milestone for the network. The proposal’s focus on token burn, validator commission rates, and community-led governance demonstrates a commitment to ensuring the long-term sustainability and security of the Terra ecosystem. While the market is currently experiencing a downturn, the potential benefits of the upgrade could lead to a positive outlook for LUNA and LUNC in the future.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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