The execution plan requires a combination of multiple proposals listed here but a fork is definitely not one of them.
We find ourselves in great disagreement over who is entitled to new token allocation should a V2 fork pass voting, refunds from LFG to UST holders, and from which time basis these distributions should be given (peg, de-peg). A fork will not work simply due to the fact that you cannot regain the trust of your investors if they all hate you for failing them before (also, anyone who would invest in a Luna V2 fork are the ones who held Luna classic or UST to begin with and likely have little or no money left anyway. Getting new money will be a hard sell). UST is what made this the ecosystem it was and it is the only thing that will bring it back.
First and foremost, I completely disagree with the notion that Luna holders are entitled to any form of token distribution or refund. When you purchase volatile asset, you always invest only what you can afford to lose, with the expectation that you can incur a capital gain or loss, and that your investment can and inevitably will go to zero, especially when buying crypto in a time where markets are shifting from speculation to use case. Yes, Luna holders are a key contributor to the network’s success, but if they truly believe in Terra, then they should have no issue holding on their coins until things can be rebuilt, and they will be heavily rewarded by doing so.
I hold both Luna and UST but I could care less about my Luna being worth 0. For UST holders, the expectation was that the coin remain worth $1 USD at all times, a digital version of a dollar. This is what was sold, promised and defended by TFL and DK. When you purchase or swap into a stablecoin, it is for price stability and protection from volatility (unlike when you purchase Luna or other crypto). There is no expectation of gain, or loss when you transition into a stablecoin. Simply put, those who set and sold this expectation to investors must take responsibility for their actions (or lack there of) as they have failed to maintain their commitment.
The best way to regain public trust is to make people whole. I fully agree with Fatman’s proposal to reimburse UST holders their UST balances in USDC.
I know this from experience. I run a successful business today, but at one point it was a total failure. Similarly to TFL, we over promised and underdelivered on a massive scale by taking on more work than we could handle in a time sensitive case, resulting in a large number of unhappy customers and ultimately the failure and collapse of the business. However, we took accountability and owned up to our errors. We made no money, and had to refund everyone one their deposits (a lot of which had already been spent on labor at a premium higher than calculated). Ultimately, we regained everyone’s trust and were able to shrink our size and restart. We continued to grow year after year and now we are bigger than we were at the point of failure. We put customers first, and it will work here too if DK and TFL put their investors first.
It is now evident that there are not enough reserves to make everyone whole, so in comes the requirement of hard work and commitment from the founders. It is estimated that $1.5B is needed to refund 99.6% of UST holders in full.
It must also be noted that raising capital from other projects, exchanges, VCs…etc is good for the overall crypto community. We are here to see crypto into the future, not compete over other projects to be the one that comes out on top. We all need each other to advance the industry, so I am unsure that big players would be reluctant to throw even a little money into the pot. (in the grand scheme of things, we don’t need a “lot” of money to fix this)
With roughly $250M in reserves, DK and TFL must fundraise externally from large scale crypto players (exchanges, firms, funds, projects) to refund all UST holders. I am sure they have excellent connections. By doing so, the trust will be restored and a transition to a fully collateralized stablecoin can be in the works. Additionally, the restoration of UST will help Luna. I refer to multiple other proposals on how to restore the price and supply of Luna, either through burn mechanisms coming from fees, using external funding to buy back and burn, or many other solutions listed.
What is needed moreover anything at this point however, is a clear path forward without disagreement or argument. Do Kwon must take leadership, accountability, and restore what he built. He should not run from his failure but embrace it and fix it. He could become the world’s richest person if he corrects this mess and sees it through. At the moment, he is choosing to back away and start over unsustainably. It is unacceptable and this community should hold him accountable should he choose to continue down this path.