The Terra Luna Classic (LUNC) community is taking a step forward in implementing a previously approved change to the LUNC burn tax distribution. A new proposal, authored by developer Frag under the name “Text Proposal 12114,” seeks community and validator approval to move forward with the revised structure outlined in proposal 12098, which passed earlier in April.
What’s Changing with the LUNC Burn Tax?
Currently, a 0.5% burn tax applies to all LUNC transactions. Under the existing model, 80% of this tax is directed towards burning LUNC tokens, with the remaining 20% split equally between the Community Pool and validator rewards. Proposal 12098, and subsequently proposal 12114, aim to modify this distribution by allocating the entire 20% to the Community Pool and a newly created Oracle Pool.
Impact on LUNC Staking
This shift will eliminate the direct allocation of burn tax towards validator rewards. Instead, the Oracle Pool will serve as a source of long-term staking rewards, potentially improving the overall attractiveness of LUNC staking for validators. However, there’s a potential downside for current stakers. The APR (Annual Percentage Rate) for staking LUNC is expected to decrease by around 0.5% due to the removal of the direct burn tax allocation.
Community Support and Market Reaction
Proposal 12114 has garnered overwhelming support from the community so far, with 99.97% of votes cast in favor. Major validators like Interstellar Lounge, JESUSisLORD, and StakeBin have also endorsed the proposal. However, votes from some other top validators are still pending.
The broader market sentiment appears to be influencing LUNC’s price at this time. Despite the ongoing developments within the LUNC ecosystem, the token’s price has dipped by 5% in the last 24 hours, currently trading at around $0.0001024. However, a rise in trading volume and open interest suggests increased activity surrounding LUNC and its futures contracts.
Also Read: Terra Classic (LUNC) Price Rollercoaster: Can Bulls Push for a Breakout?
Looking Ahead
If the proposal passes, Frag, the developer behind proposal 12114, estimates a completion timeframe of 56 hours for implementing the revised burn tax distribution. The implementation process will involve development work, testing phases on both local and testnet environments, and finally, coordinated rollouts on the mainnet. With a high chance of completion by mid-July, the Terra Luna Classic community appears poised for a significant change in its burn tax structure.
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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