The week saw various Terra -related dramas. Here are details of what applies to its native coin, LUNA and stablecoin, UST.
UST, a failed project
On Saturday, Terra - Do Kwon CEO admitted the stablecoin project, UST was one of the biggest failures.
It is clear that the liquidity of LUNA is too high causing its ecosystem with UST cannot be rebuilt.
For the record, LUNA has posted a nearly 100% decline from a daily high of $ 88 on May 5 to $ 0.0002026 at the time of this writing.
Meanwhile UST has collapsed from the US dollar bond from $ 1 on May 9 to $ 0.127 with an 89%decline.
Hard fork Terra
Through the latest tweet on Twitter yesterday, Kwon revealed that Terra will face a hard fork to maintain the network's existence in the crypto space.
Through a hard fork, Terra will be broken down into:
‘New’ Terra - comes with a new coin, LUNA
Previous series - Terra Classic with LUNA coin support which became Luna Classic (LUNC).
It is understood the new LUNA will be distributed via airdrop to all Luna Classic holders and stakers, including UST holders and app developers at Terra Classic.
The effort aims to make Terra a community -owned network with an inflation target of 7% through staking rewards.
Compensation for the Terra community
Kwon also proposed a limited LUNA production proposal of 1 billion.
According to him, a quarter of the amount will be put into the Terra community, 5% to developers, 35% to wallets that owned LUNA before the Terra Classic collapse incident, 10% to LUNA holders during Terra launch, and 25% to UST holders.
Kwon is still working to work with crypto exchanges to airdrop LUNA holders on those platforms.
Terraform Labs is an exception to this effort.
Hard fork refers to the situation for a blockchain to split into two, leading their respective directions but still operating simultaneously even though they are already different.
