Following the aftermath of Terra’s UST implosion, the blockchain project’s founder Do Kwon has been actively discussing the Terra ecosystem revival plans and one specific proposal will be voted on May 18. The plan is to fork the blockchain into a new chain that does not include an algorithmic stablecoin, and the newly minted tokens from the network will be airdropped to Terra ecosystem participants and holders.
Terra community members plan to vote on a fork proposal to revive the broken project
Last week, the Terra blockchain ecosystem was wiped out and the project’s native tokens lost significant value. At the time of writing, a single LUNA token is trading for less than a US penny, and the once-stable coin terrausd (UST) is changing hands for $0.09 per unit. Over the past few days, the Terra team – Terraform Labs – and the community have been discussing how to address the project’s fallout and restore value to blockchain participants and holders. On May 16, Terra founder Do Kwon released a relaunch plan to address the project’s issues, and the proposal will be voted on Wednesday, May 18.
The proposal called “Terra Ecosystem Revival Plan 2” aims to fork the blockchain into a new chain that doesn’t involve adding an algorithmic stablecoin. The old chain will be called “token Luna Classic or LUNC” and the new chain will inherit the original branding by being called “Terra LUNA.” Following the split, the new tokens will be airdropped to Luna Classic holders, stakers, application developers, and residual UST holders. The wallet owned and operated by Terraform Labs (TFL) will be removed from the airdrop entirely.
Kwon says “the Terra ecosystem and its community are worth preserving” and that the app ecosystem built on Terra has hundreds of developers. Terra Station has over a million users worldwide and Kwon believes that despite the recent fallout, “[Terra has a] strong brand recognition and a name that almost everyone in the world will have heard of. The token distribution details note that there will be 1,000,000,000 new LUNA tokens tied to the Terra Chain.
25% will be dispersed to the community pool for staked governance and 1% will be allocated to essential developers with no lockup period. 4% will be dispersed to essential developers after a one-year cliff and four-year vesting period. 35% will go to all bonded and unbonded LUNA stakers except for TFL. Wallets with one million LUNA or less will have different vesting periods. 10% will go to LUNA holders and 25% will go to UST holders.
Community responses indicate that people disagree with Terra’s rebirth proposal
The proposal states that a “pre-attack snapshot” will be taken at Terra Classic block number 7,544,914. The chain fork will begin a few hours after the launch snapshot is taken and an estimated date for the launch of the new Terra Network will take place on May 27, 2022. The proposal seems to have a lot of people disliking the plan, while others favor the idea being put on the table. One person wrote, “This is an interesting proposition and I’m glad the community is moving forward with a new channel.” Another person against the idea said:
No one wants a fork. Just burn the current LUNA and fix the current algorithm to get back UST peg.
Some people didn’t like Kwon saying “Terra was more than just UST”. “I agree Terra is more than $UST,” the individual replied to Kwon’s post. “There should be stability for the 180 fiat currencies. I don’t want a fork. I believe 99% of Terra’s value remains in the system’s current incarnation. Kwon thinks the proposal is “a chance to rise from the ashes” like a phoenix.
In fact, Terra did have a suite of fiat currencies in addition to the most used and most popular UST stablecoin. Terra’s KRW stablecoin was popular as well, but the token de-pegged from the Korean won’s value. A single KRW is worth $0.00079 today while the blockchain-based terrakrw token is only worth $0.00006945.