This proposal is just an idea, I don’t know if this makes sense or would work in the first place. If this works, it could be an effective way to burn Luna, balance out the circulating supply and price of the tokens. All this without letting down old or new holders.
The revival plan is getting a lot of bad responses. It seems like the majority of the community and experts in the space like CZ from Binance want to see burns happening. I’m trying to offer my take on this.
Again, before I begin, I don’t know if this would work in the first place. I’m NOT an expert in the crypto space, just a community member that sometimes has illogical ideas, but I want to talk to people about them to see if they make sense or not.
So, couldn’t they just do a reverse staking mechanism that burns the Luna supply and pushes the UST value as a consequence? So for example, you stake Luna and as a reward you get a new token. The amount you get from the new token will be equivalent to the amount of Luna that gets burned in the process of staking. With the new token you can buy back UST and in the process the new token gets burned 100%. In my understanding this would balance out all three tokens in price and circulating supply when you introduce it into the algorithmic system we have now. The only important thing would be that the new token you receive has real value (by backing it with something for example). The value and circulating supply of the new token wouldn’t change because the same amount gets minted and burned in this three-step process.
Considering the algorithmic system we have now, the Luna supply could be burned by a lot but still be stable enough to not inflate.