I propose to use all of the burning power - both from LUNC and UST fees - to restore the UST peg; the LUNC supply would stay the same - until the UST would reach 1$ - as all of the LUNC earned with the burn tax would be changed into UST, and burned as the UST.
So i propose:
for now using both LUNC and UST burn tax to burn UST
after UST reaching one dollar - as a compensanstion for LUNC holders - using both UST and LUNC fees to burn only LUNC
Advantages:
a much smaller market cap of UST (comparing to LUNC) could allow us to impact its price in a significant way
after the recovery of UST the whole blockchain would probably experience an inflow of capital
Disadvantegs:
I think you are right, but this subject is not touched by majority of community, I dont know why. They want burn LUNC, but the more important for LUNC is to repeg the USTC. In my opinion they bought millions of lunc and they wait for 1$ to sell…
Hi,
I still don’t know if validators would support the idea, and I don’t think I have enough technical knowledge on Terra bloackchain to write some of the details of this proposal.
But all of you can feel free to use this idea, if you think it could pass the voting.
1- burn the supply of ustc, counting on the possibility that the news will create fomo and the price goes up until it reach 1$.
2- Once the price reach 1$, people will sell out, making the price drop. The tax will continue to burn ustc and if there is enough utility that uses the coin, ustc could definitly go back to 1$ and even beyond.
3- Once it goes beyond, the algorithym could could be minting more ustc by burning lunc. Trying to stabilise the price of ustc at 1$. If it goes below, counting on the burn tax to bring it back up. And the circle continues on amd on until lunc reaches 10B.
this is not good : after UST reaching one dollar - as a compensanstion for LUNC holders - using both UST and LUNC fees to burn only LUNC
The reason is, nothing is preventing ustc to fall back down. Burning ustc supply could prevent that.
Better to leave the burn tax on ustc and mint more ustc/burn lunc to keep ustc at 1$ when it goes over.
It’s gonna take approximately $300 million to re-peg USTC if you keep burning it. If we burn at around $1 million per month, that is 300 months. Let’s assume it’s around $2 million per month. It’s 150 months. It won’t work like this.
Currently the entire market cap of the USTC is below the 300 millions, so I don’t know if it’s a good approximation.
When it comes to keeping USTC price on and above the “peg” after reaching it - if it would ever fall again beyond one dollar it would probably be enough to restore this proposal and focus on burning the USTC again.
One absolutely crazy idea is the creation of a new coin.
We gotta sell about $200 million of a new (shadow) coin first, and then do the following:
Burn $200 million of USTC
Get $100 million from somewhere - VC or anything
Repeg 100 million to 100 million USTC
In total, we need about 300 million to repeg USTC.
The main issues are:
Will we be able to sell 200 million of another new coin to the public?
Will they be convinced/happy if we give them re-pegged USTC instead of the coin that they bought?
Will the holders willingly give up their coin to a burn wallet for an equal value of USTC in return?
And finally, even if this endeavor is taken up, who is gonna lead it? Cause with the amount of work pending on TR’s table, I honestly don’t think this is something that TR can take up. People will anyway get to know that the new coin is associated to Luna Classic and we can’t let that happen. It needs to be a shadow coin that no one knows what we are gonna do with until the time comes to let them know what we are doing with it.
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This idea stems from another idea:
“Incentivize USTC holders to swap their USTC tokens for a specific number of the new post-rev split token. For example, if the new token is is named GELD, the GELD remains locked up until the collateralization and revaluing phase is complete. The USTC swapped in will be sold for new collateral in the market over a specified period of time.” - otiswarder
I don’t know if you was replying to me. No one should sell anything. Each holder has nothing to do. Simply your wallet has the number of coins divided by 40. But each coin worth 1$.
Example. Your wallet has 40,000,000 ustc at the actual price (0.025 $) so you have 1 million dollar. After the reverse split your wallet has 1,000,000 ustc at the price of 1 $ so you have 1 million dollar. Nothing change. Change the Total supply and price of the single coin.
Im strongly against this idea. How can you say that nothing change? For someone before crash everything change, because he will have 40x less. Ust can reach 1$, no more. Different situation os for luna because luna can reach 1$ or 10$ or even 30$. If you want to do redenomination, more sense is do it for luna, not ust
One of the main problems with trying to repeg USTC is the fact most of the supply is held by a handful of whale wallets. Another issues is that there’s far more hype tied to LUNC than USTC (pre-crash holders of the latter notwithstanding), so anything that steals LUNC’s thunder won’t be accepted well by the wider community (and burning through most of the USTC supply would still take dozens of months at present rates). Yet another obstacle to any USTC repeg is the supposed $10B of debt attached to it, since most holders (whales) will begin liquidating the moment it becomes profitable for them to do so. There’s probably a host of other issues I’m forgetting at the moment, but these are the big 3 I can think of off the top of my head…
Regardless of all that, you really need to run some math models with these things since you’re proposing a change that will impact the entire chain, both its main tokens, and also a host of other things tied to the aforementioned that people smarter than myself would point out. Consider swinging by the USTC Revitalization channel on Terra Rebels’ discord channel and discussing your plan with some of the quants there, they’ll probably be able to give you much better feedback than you’ll receive from random posters here (especially if you’re interested in fintech breakdowns).
