@Crypto_Inquisitor while I like where your head is at, I think what @dokwon was referring to with:
You’re not supposed to use LUNA-UST liquidity during a bank run - why would you ever do this
is that if there is an underlying issue with Terra that is forcing a bank run, you’re not likely to run to the same native assets. You’d likely want to move to BTC, ETH, USDC or USDT (or some other asset that is perceived to be stable outside the Terra ecosystem).
However, I agree with your general sentiment that putting the community assets to work as a productive treasury asset (similar to Olympus) would be prudent and would likely further dampen downside volatility.
Specifically if it is protocol owned value that is providing deep liquidity in other assets to act as a hedge against a bank run & de-pegging event. Ideally the LP rewards on this liquidity are redistributed back to LUNA stakers in the form of LUNA in order to increase the attractiveness of LUNA as an asset. I believe this is starting to be doable with liquidity ramping up on DEXs.
This is not dissimilar from what you and I were discussing over here: Proposal: add currencies as Luna reserve - #25 by ekryski.
In any case, maybe we move that discussion to the new thread here: Towards protocol owned liquidity on Terra
Getting back on track, I’m in favour of this proposal for many of the reasons people mentioned. I would prefer to see less than 90% converted to UST as well, I think closer to 50/50 would be prudent so that if LUNA is needed for other purposes, fees aren’t incurred for converting UST back in the future. Specifically if LUNA is needed to help backstop Anchor or liquidity providing on DEXs.
That being said “burn” isn’t really the best term for what is happening here, we’re really just converting LUNA to UST and “locking in” the value of LUNA now so that UST can be used more productively for ecosystem growth, which is a huge plus. 
In addition, having a huge amount of UST held by the community itself should help to maintain the peg as well.
Personally, I’m completely fine with @dokwon being the custodian of the key. Whether or not multisig should be established could/should be the matter of a separate vote. It’s out of the context for the proposed LUNA burn. After all, the generated UST will be returned back to the community pool.
I too would also like to see a multi-sig on wallets that aren’t dedicated TFL wallets, mainly for the sake of the “community funds” living up to its name and further decentralization. It looks like a proposal for something to that effect passed here a few months ago, but there has been very little update on the status thus far.
Right now I think it’s kind of a moot point though. Do Kwon and TFL still dictate a ton of the success of the project and have more than enough capital themselves. Based on every interview and public comment I’ve seen, Do doesn’t seem to be motivated by money (like me) and he’s public enough that running off with $3B would kill all his credibility and frankly, be super hard to get rid of. So while possible, running off with the community fund would be suboptimal game theory play and if a rug pull was intended that could have happened a few times already in Terra’s history.
However, @dokwon to protect yourself from regulatory scrutiny it would be prudent to have non-TFL dedicated addresses use a multi-sig for manual backstopping going forward. 
That’s my 2 cents. I’ll be making a last minute vote “yes” if I think this is going to pass. If it fails, I propose we set up a multi-sig first and reduce the amount burned.
