This proposal is written on behalf of the top 12 validator with 24 billion delegations: “1% MAX fee”. You can support us in our plan by delegating your LUNC to us. Let’s make LUNC great again!
Contact us:
Twitter: @MAX_fee1
Telegram: @MAX_fee1
Mail: [email protected]
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content of the proposal:
- What is “OFF-chain” and “ON-chain” ?
- Why is “OFF-chain” burning still not enabled and why is it dangerous for the exchange?
- Our solution for safely enabling “OFF-chain” burning
- The difference between our proposal and the proposal of Terra Cvita (Terra Port)
- What if the exchange refuses to burn LUNC and USTC?
- Will Binance support or not?
- What happens if all exchanges decide to remove LUNC from trading pairs?
- The specific value of the commission
- Theoretical increase to burning
- Why is burning so important to our community?
- Proposals for voting
- Message to anyone who does not agree
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1. What is “OFF-chain” and “ON-chain” ?
“ON-chain” is a type of transaction that occurs between two users in the blockchain.
For example: User A sent 100 LUNC from his Terra Station wallet to User B’s Terra Station wallet. Of this amount, 0.2 luncs will be burned, since there is a set percentage of burning in the Terra Classic blockchain.
“OFF-chain” is a type of transaction that occurs between two users on an exchange. The rules of the blockchain do not apply on the territory of the exchange, since such transactions occur without affecting the functions of the blockchain.
For example: sale and purchase of LUNC on the stock exchange.
Let’s take a look at how the exchange works with the LUNC coin.
Any exchange has one or more wallets where all users’ coins are stored. When replenishing the exchange, you specify an individual “memo”, with which the exchange will find out how many coins belong specifically to you. After the sale, the coins continue to remain at the same address, but they are debited from your account on the exchange.
This is called “OFF-chain”, when the transaction occurs in isolation from the blockchain, which is why the network commission is not applied.
2. Why is “OFF-chain” burning still not enabled and why is it dangerous for the exchange?
“OFF-chain” burning means burning a percentage of the commission for all actions taking place on the exchange. For sale, purchase, etc.
Terra Classic developers were able to implement “ON-chain” burning at 1.2%, but it did not work out to implement “OFF-chain” burning, since its implementation depends on the exchange itself, and not on the blockchain, as we found out earlier.
The main danger of enabling “OFF-chain” burning for the exchange is the lack of a guarantee that other exchanges will also turn on burning.
For example: If the Binance Exchange raises the commission to 1.2% for the sake of burning, and the KuCoin exchange does not raise the commission to 1.2%, then with a very high probability many Binance users will switch to trading on KuCoin, because there is a banal less commission. Because of this, Binance risks being left without customers and profits, and no one wants that.
The head of the CZ Binance also spoke about this and pointed out this danger.
Therefore, the only right option is to give a guarantee to all exchanges that the commission will be increased for everyone at the same time.
3. Our solution for safely enabling “OFF-chain” burning
We suggest using a “partial blocking” system for dissenting exchanges.
If the exchange refuses, its addresses will be blacklisted, after which sanctions will be applied against the exchange.
Specifically, by sanctions, we mean disabling the ability to receive incoming transactions on the exchange’s wallets.
This is the best solution, as it harms the exchange specifically, not its users. Users will be able to withdraw their coins, but no one will be able to deposit them, and this deprives the exchange of one of its main functions.
Also, thanks to this, users will not be able to switch from one exchange to another for the sake of a lower commission, thanks to this, the exchange that turned on the burning will not lose its users.
If the Exchange agrees to introduce a commission for the implementation of burning, then its addresses will be “whitelisted”, as well as Binance addresses were previously entered.
We also talked to several senior developers to find out if it is technically possible to implement it in the blockchain, and they all replied that it is possible to implement it.
Of course, certain addresses will be blocked only after voting in the blockchain, what will still preserve decentralization in the blockchain.
4. The difference between our proposal and the proposal of Terra Cvita (Terra Port)
On April 23, Terra Port put forward proposal 11488, which some may think is similar to ours or somehow related to us. But in fact, no, we have nothing to do with their proposal and we can easily prove it.
We started developing our offer long before Terra Port was launched and long before it was hacked. On March 24th, I published the first version of our offer to the Medium for discussion in our Russian-language chat in Telegram. Russian LUNC community turned out to be our most active community, which is why the first version of the proposal was written in Russian and was not published more openly.
We also sent this article to some people in personal correspondence in order to hear their opinions and make edits in the final version. Therefore, perhaps some have already seen this article.
Here is a link to this article: How to properly enable «OFF-chain» burning of LUNC and USTC | by 1% MAX fee | Mar, 2023 | Medium
Also a post from our telegram chat and a link to it:
Translation: I wrote an article about how it would be possible to properly activate “OFF-chain” burning on exchanges in order to burn a large number of LUNC and USTC.
Soon this proposal will be put up for discussion on the Agora Forum, but for now I decided to show you first. I will be glad to hear your opinion. the article can be read here.
the article can be read here
For those who are interested, Terra Port was launched on March 31 and was hacked on April 10. This is evidenced by the posts on Twitter Terra Port.
There is also a huge difference among our offers:
- The Terra Port proposal implies a complete blocking of addresses, without the possibility of output and input of LUNC
- Our proposal only implies blocking deposits to the address ( this was also mentioned in the first version of the proposal )
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- The Terra Port proposal does not imply blocking addresses by voting in the blockchain
- Our proposal implies partial blocking of addresses only after successful voting in the blockchain
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- Terra Port’s proposal is aimed at completely blocking the addresses of hackers (hackers are the same users)
- Our proposal is aimed at partially blocking the addresses of dissenting exchanges
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The difference between user addresses and exchanges is very big.
If you block the replenishment of the wallet of an ordinary user, then he will be able to simply withdraw his LUNC to a new address and will not feel the difference in any way.
If you block the replenishment of the exchange’s wallet, then the exchange will no longer be able to “simply” transfer its LUNCs to another address.
Since a huge number of LUNCs of all exchange users are stored on the wallets of the exchange. And even if they send them to another wallet, they will lose part due to the network commission.
It also requires the tremendous work of many employees of the exchange to successfully emigrate from one address to another. It will not be possible to do this in one or two days. And even if they do, it will only be for seven days, since then the addresses will be blocked again.
Also, exchange users will also not be very pleased that their replenishment address has changed or will change frequently.
This will cause problems in the operation of the exchange system. Because of this, it will be more profitable for her to agree to our burning conditions than to figure out how to get around it. After all, its users will be able to withdraw funds in any case and switch to a normally functioning exchange.
5. What if the exchange refuses to burn LUNC and USTC?
The dissenting exchange will have three options:
a) Create new wallets to replace the blocked ones
b) What happens if all exchanges decide to remove LUNC from trading pairs?
c) Agree to the burning and return the functionality of their wallets back
Option “a” will work for a very short time, because it will take a lot of time for the exchange to replace the blocked addresses with new ones, and in order to block new addresses, it only takes 7 days to vote in the community on blacklisting addresses.
Option “b” will only harm the exchange itself, because the exchange will lose users who will be able to safely withdraw their coins and switch to another exchange.
That is, if earlier the exchange that implemented burning risked losing customers, now the exchange that does not support burning will definitely lose customers, because there will be a strong pressure factor that was not there at the first attempt of implementation.
6. Will Binance support or not?
The Binance exchange hosts the most LUNC trades, so their decision will have a strong impact.
We think that CZ will support this initiative with almost 95% chance.
Firstly: The head of the exchange has repeatedly said on his Twitter that they are ready to implement 1.2% burning, but they did not do it for the reason I described above. We think if we provide a guarantee of honesty on the part of other exchanges in the way I described above (point 3), then the Binance is very likely to support us. After all, they are even now burning 0.1% from purchases and sales on the stock exchange. CZ wants to burn LUNC, but so as not to harm himself.
Secondly: If Binance agrees (which he already did when he started burning his own commission) and the other exchanges do not agree, then users from all exchanges will be forced to switch to Binance to continue trading, and this will only increase the volumes on the Binance exchange.
Thirdly: This will make sense of burning Binance, since what is the point of burning him if the others don’t do it?
Fourth: If the Binance exchange does not support “OFF-chain” burning, then their wallets will have to be blocked, which will lead to an outflow of users to other competitor exchanges. After all, 100% there will be at least one exchange that will support “OFF-chain” burning. It will be a shot in the foot.
To put it briefly: Binance has already burned a bunch of coins and is still burning, and this proposal will give meaning to his burning or increase his influence.
7. What happens if all exchanges decide to remove LUNC from trading pairs?
By itself, the chance of such an event is very, very small, if all popular exchanges refuse, then 100% there will be at least one exchange that will agree to burning in exchange for the opportunity to work with LUNC, and in this case it will become very popular.
Let’s not forget that LUNC is a very popular coin, and its holders have a very high demand on the exchange. And as we know, demand generates supply, and sooner or later such an exchange will appear. For example: Binance or MEXC that have already been burned. I think they won’t mind new users.
8. The specific value of the commission that we offer
we offer a 0.2% commission for exchanges for the following reasons:
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Such a commission is now installed in the blockchain itself, and this will make «OFF-chain» and “ON-chain” transactions equal.
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Too large a value, such as 1.2%, will greatly reduce the volume of trading on the stock exchange, due to the large commission. And because of this, the exchanges may refuse to cooperate with us. 0.2% is the optimal value.
We think that if the burning commission is 0.2% in the main network on exchanges, then everyone will quickly get used to it, thanks to which a huge amount of LUNC and USTC will be burned every day.
9. Theoretical increase to burning
*These are approximate dates, as no one really knows. The data is taken from the coinmarketcap.com ***
LUNC = 0.00011$
USTC = 0.02$
The total volume of LUNC spot trading in the last 24 hours is: $40,869,000
The total volume of LUNC futures trading over the last 24 hours is: $57,379,937
The total volume of USTC spot trading over the last 24 hours is: $19,023,969
The total volume of LUNC futures trading over the last 24 hours is: $1,743,000
from this we get that USTC will be burn per day in the amount of $200,000 (1 769 129 000 LUNC) and $6,000,000 (53 073 900 000 LUNC) per month.
from this we get that USTC will be burn per day in the amount of $41,533 (2 066 318 USTC) and $1,246,018 (61 989 552 USTC) per month.
10. Why is burning so important to our community?
After the collapse of LUNC, there was no hope that this coin would ever become great again. But everything was changed by Vegas and Terra Rebels, who came up with a burning plan to reduce emissions and return the cost of LUNC. It was a wonderful plan that breathed life and restored faith in this coin. The whole community was waiting, hoping that it would work.
But unfortunately, this plan did not work, because after the introduction of burning, everyone moved to the exchanges, and activity on the network fell. And none of the exchanges wanted to include burning except Binance. Everyone was upset and gave up, because no one can force the exchanges to listen to us.
BUT, it’s time to change this, to bring back those forgotten dreams and desires again, and for this you need to make decisive proposals, clearly set a goal and go to the mute.
To do this, we became one of the validators to contribute to the development, for this more than 3,000 people delegated to us.
And just like last year, the whole community gathered to help start the burning, now we also ask you to accept our suggestions to make LUNC great again!
11. Proposals for voting
[Proposal 1] (it will be put forward for a vote in the blockchain after 7 days of discussion of this proposal)
Start developing the blacklisting function in the blockchain. This will make it impossible to replenish certain addresses, but will leave the possibility of withdrawing funds from this address.
[Proposal 2] ( after completion of development and testing)
To publicly declare our intentions and inform all exchanges of our conditions: namely, the burning of 0.2% LUNC and USTC on spot and margin trading with a monthly public report. Give exchanges 2 months to implement this function on their part.
[Proposal 3] (7 days before the expiration of the two-month period)
Blocking the addresses of exchanges that have not agreed to our terms, with subsequent monitoring of these exchanges, in case they decide to change their minds or create new wallets.
12. Message to anyone who does not agree
Since the launch of 1.2% burning on the network and until today, the community has not received a single effective proposal to enable burning on exchanges!
We offer an proposal that is beneficial to absolutely everyone.
We give:
- a guarantee to exchanges that their burning will not be in vain
- a guarantee that they will not lose customers
- a guarantee that dissenting exchanges will not be able to trade our coin
- a guarantee that the number of coins burned will increase
If you refuse our offer and answer “NO”, then please provide us with your version of the implementation of burning on the exchanges. If you criticize, then offer. And if you have nothing to offer, then don’t stop us from doing our job and kindly step away.
I will tell you right away that simply “asking the exchange to turn on the burning” will not work, since this is how you think about yourself, and not about the exchange, which will lose customers. It’s a pity that few people understand this.
- Yes
- Abstain
- No
- No with veto
0 voters
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This proposal is written on behalf of the top 12 validator with 24 billion delegations: “1% MAX fee” . You can support us in our plan by delegating your LUNC to us. Let’s make LUNC great again!
Contact us:
Twitter: @MAX_fee1
Telegram: @MAX_fee1
Mail: [email protected]
