A Strong Burn Tax Helps Pre-Depeg Holders

Hey all, just wanted to talk about something I haven’t seen anyone mention yet.

First off, if you aren’t familiar with the burn tax proposal see:


A strong burn tax ( > 20%) on selling/buying would actually help pre-depeg holders. It would do two things:

  1. New investors would need to invest more keep their money in the system longer to make a profit. This means swings in the price would be less wild
  2. A stronger tax means LUNA burns faster, which helps pre-depeg holders regain their worth faster.

Obviously this tax would decrease as LUNA becomes more valuable. I’m spitballing here but something like:
LUNA < .0001 → 25% tax
LUNA < .001 → 15% tax
LUNA < .01 → 5% tax
LUNA < .1 → 2% tax
LUNA < 1 → 0.2% tax
LUNA < 10 → .02% tax
number of LUNA < 1Billion = Burning Mechanism goes away entirely

Anyone have any thoughts or a reason this would be a bad idea? Even with a 25% tax a speculator could have made 5X their money back over the last week.



This is a great addition to that proposal. Taxes should fluctuate/ be apart of the UST algorithm to compensate and stabilise the value of the coin