Terra, one of the top 15 cryptocurrencies by market cap, plans to apply the Columbus 5 upgrade to its mainnet today. If everything goes according to plan, this new update will bring improvements to allow the Terra network to keep expanding. Columbus 5 will change the way the UST (terrausd) network currencies, the main stablecoin in the blockchain, and will also bring integration with other chains and faster transactions.
Columbus 5 to Go Live Today
Terra, a smart contract-enabled cryptocurrency chain, is prepared to apply the new Columbus 5 mainnet upgrade today. This will bring important updates to the network that could pave the way for future growth. However, the upgrade procedure is anything but simple: the old mainnet, Columbus 4, needs to be stopped completely to be replaced by the new one. The Terra team estimates this upgrade will take two hours.
The network upgrade will bring fundamental changes in the way the UST is manufactured. Before, to mint the UST stablecoin, users had to pay a fee called seigniorage, which was redistributed to the community. With the changes of Columbus 5, this seigniorage will be completely burned, adding to the rarity of the LUNA token. Due to this, the update has been referred to as a sort of EIP-1559 for Terra.
In addition to this, the update brings IBC support, which allows Terra to communicate with other networks such as Solana and Polkadot. This will allow the movement of assets between these networks, potentially increasing the presence of Terra-based assets in other chains.
The expansion of Terra USD is the goal
Terra developers and supporters expect these new enhancements to allow UST, the system’s native stablecoin, to become the de facto decentralized stablecoin across multiple blockchains. At the same time, it is thought this UST acceptance would create an appreciation of the value of Terra’s governance and minting token, luna (LUNA). This is the reason why a new bridge called Wormhole, which will provide easy access to UST stablecoin on Solana, will debut in this upgrade.
The Terra ecosystem, albeit young, has made an impact in the cryptocurrency market. Although UST is still not listed on some of the biggest exchanges like Binance, it has reached a market cap of $ 2.6 billion, becoming the fifth largest stablecoin by market cap. Luna has also grown immensely, experiencing growth of over 10,000% in one year.
