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On May 16, Do Kwon, co-founder of the struggling Terra Luna blockchain, announced revised plans to restore the ecosystem after a combination of significant market volatility and entrenched protocol design flaws wiped out much of the blockchain's market capitalization. According to Do Kwon, Terraform Labs will launch a new governance proposal on May 18 to fork the Terra Luna blockchain known as Terra Luna (token name: LUNA).
However, the chain will not be linked to the TerraUSD stablecoin (UST). Meanwhile, the old Terra blockchain will continue to exist with UST and will be called Terra Classic (LUNC). According to Kwon's plan, if the hard fork proposal is adopted, the new LUNA blockchain will be operational on May 27.
Under the proposal, the new LUNA tokens will be transferred to LUNC owners, UST owners and essential developers of the Terra Classic blockchain. In addition, Terraform Labs' wallet with terra1dp0taj85ruc299rkdvzp4z5pfg6z6swaed74e6 will be removed from the white list for airdrops, thereby turning Terra into a completely community-owned chain. LUNC's proposed supply is limited to 1 billion, with 25% going to community groups, 5% for essential developers, and 70% for LUNC and UST owners at various snapshots of events in May, depending on the conditions of empowerment.
Earlier today, Luna Foundation Guard, the ecosystem manager, revealed that it used up a large portion of its cryptocurrency reserves to try to protect ust's peg during the market sell-off. Therefore, it is unlikely that the Terra ecosystem can save itself without the help of external capital. Changpeng Zhao, CEO of Binance, said that he would support Terra's community but would like to see more transparency from the organization regarding recent events.
2/ It has been inspiring to partake in the dynamic discourse regarding the best next steps for Terra. Taking feedback from the community and thoughtful proposals, I would like to suggest the following for the path forward.https://t.co/E13VI8bkLh
A thread on our reasoning:
— Do Kwon 🌕 (@stablekwon) May 16, 2022
