Free Market Approach to Terra Revival (Swap Strategy)

No fork. No snapshot.

Swap LUNA to a new spLUNA token via a publicly announced swap in order to target a reduction in LUNA circulation. Free market dynamics will determine value recovery for UST and value accrual for LUNA in the interim, as speculators of the swap ratio will drive uncertainty value component.

spLUNA will be the only token that can be staked in a new pool. Said pool pays out UST APY via swapping between UST investors staking UST in the pool for Y-years to receive USD par value at maturity. UST investors balance converts daily to a mix of stable coins but not withdraw-able until maturity

UST retains its new non-stable coin status and a second coin in the Terra ecosystem. Protocol will accumulate USDC/USDT/DAI in preparation for par redemption in Y-years.

Recovery will be better than current proposal for UST investors. And ALL LUNA investors will also accrue value (post-depeg and pre-depeg).

Promotes free market forces to auto correct Terra. Subjective valuation of its ecosystem by each speculative investor, big or small.


  1. Announce a X:1 swap of all LUNA at a publicly disclosed swap date (T1).
  2. Swap equilibrium speculation will drive interim capital into LUNA pushing its price up resulting in UST slowly getting closer to peg (over time, i.e, T1 - T0). Allowing UST investors potentially better recovery in the interim.
  3. Final swap ratio is a function of the price of LUNA at time T1.
  4. OPEN TO ALL investors. ‘Whales’, et al.
  5. Then execute spLUNA mechanics as noted in the summary.

Only initial thoughts by an independent observer. Approach can be adapted by Terra system veterans as necessary

But the approach will keep capital flowing, continued trading, but importantly, allowing free market dynamics to take hold, without silly forks or snapshots.

Community driven recovery without bailouts or resets or reorgs.

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