Legal Representation for the Terra Classic DAO

Governance & Proposals
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Do Kwon, the founder of this chain, was arrested a few days ago; we are waiting for official confirmation. The SEC has put Coinbase on notice for allegedly breaking securities laws, which could lead to several delistings of products defined as securities by the SEC.

There is no one clever guy out there that will put his hands on wallets previously created by the old governance, or directly connected to them as of now. Legal advice / consultation is imminent if we want to move forward without thinking twice about everything, eg to acquire the multisig wallet, blacklist any previously created wallets, repeg or even touch USTC, etc.

As for the choice of the firm, I’ve really no opinion but I respect and trust Ed. Some extra information on the structure of the offshore firm and their responsibilities would be great, but I hope that will come in the near future.

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31

:+1: :+1: :+1: :+1:

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32

Community rejects proposals that raise money for the Community pool.
But then realizes we need money for various proposals to take place.
You all voted against increasing the burn tax to 0.8% and changing the tax antehandler to at least 25% so that we can fill the community pool with part of the burn tax.
Well… nothing comes for free.
Now we will have to let go of Duncan’s Ziggy Plan and reduce the funds for the L1 team if we have to fund this .(Which seems to be a necessity at this point given all the attacks from the SEC)
An issue we would not be having if we had raised the burn rate to 0.8 percent and committed 0.2%(basically what we burn right now every month) of that 0.8% to the community pool.

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33

I actually don’t know enough about everything that’s going on to decide whether the proposal is okay or not, and whether it’s time for it or not. I’m from the EU and when I read and listen to various discussions about crypto topics, I really can’t understand why everything still revolves just around US laws, as crypto is fundamentally global and decentralized in nature. Other countries have laws too. Most blockchains are actually untouchable and that’s where we have power. Power in the sense of ‘Can crypto exist without the US? Can the US exist without crypto?’… I know this is a very complicated topic as it touches on global crypto regulation. Probably crypto will run to countries that are crypto-friendly until the countries that ‘prohibit’ it realize the damage they are doing to themselves.

I understand your proposal mainly as the first protection of individuals operating in the US. As I said before, I don’t know enough about the topic and therefore remain undecided - ABSTAIN.

Ed, I really appreciate your work, I also read your recent article on Medium. I know this is not related to this proposal, but I still wanted to ask you something that came to mind. Currently, our focus is on re-pegging and finding a NEW IDENTITY for Terra Classic. When mentioning AI and Terra Classic, it occurred to me whether it would be possible to introduce AI technology into our stablecoin. This way, we could have the First AI-driven STABLECOIN, which could be very attractive for the recognition and new IDENTITY of TerraClassic?"

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34

such a move seems to suggest seriousness and commitment to a long-term project. if it is approved, it will increase my confidence in investing in lunc.

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35

Hi @ek826 ,

While I have similar concerns regarding legal issues and protection, I do not think the structure you mentioned will retain/maintain the DAO (as a legal structure) in the hands of governance as the owners.

From a legal theory perspective, at least in the U.S., organizations (of people) gain their personhood from the rights of the people within the organization-of-people as they exercise those rights together as a collective group. It is normally those who have the ability to vote that are considered the owners of an organization - and here I use organizational in its broadest sense that still maintains a legal presence. In Terra v1, it is those that stake the native mining coin Luna v1 that have the ability to vote, and therefore to determine the course of the protocol (both by whitepaper [section 3 - last paragraph], documentation [here and here], and by code in the staking system). I agree with some other comments, that the structure, while trying to attempt to protect an ownerless aspect, would in practical terms, as outlined, favor a more centralized structure and concentrate influence (unless the committees are only in place for a specific function such as implementing a specific proposal, only for the duration of the process, the independent attorney themself serves as the director with no authority outside the direction of governance via a proposal that has passed, and governance through proposals approve the creation or dissolution of committees - each committee only functioning to carry out a specific proposal).

I do think that the legal issue is important since “it was the protocol, and not the person” will not work with the courts - they will apply the law to a specific person (at least from what I have read in law and in court opinions - although I am not an attorney, my understanding of law is no where near a complete picture, and this is not legal advice).

Here is what I would propose:

  • That the Terra v1 governance go ahead and work with an attorney to recapture the trust that was formed here as part of this discussion on the sports deal, but was not listed as part of the creation of Terra v2 in proposal 1623 [here or here], nor included in Terra v2’s documentation, but retained in Terra v1’s documentation. This trust currently “holds all of the intellectual property rights to TERRA, LUNA, and UST” (even if we leave the name issue alone for the present time). And to work with governance to vote in new trustees (preferably an independent attorney within a law firm, an independent accountant, and an independent auditor or CPA - all hired as yearly services).

    • The trustees should take no actions on their own, but:

      • recommend actions to the community as legally required,
      • should work with any proposal author whose proposal has passed governance to implement governance that has a legal aspect(s) to enact,
      • and/or to offer legal consultation during proposal discussions.

    • They should publish an audited report yearly, and the financial records should be open for request of those who can show they have staked Luna v1, or to an attorney with legitimate legal business (with any expenses born by the person requesting except where law provides otherwise).

    • The language of the trust document can be adapted in an appropriate jurisdiction, where the jurisdictions trust laws allow for the personhood rights the trust document legally outlines. As it is outlined, it can handle the following (but not necessarily conduct day to day business beyond the stated goals of the proposals that have passed governance):

      • The Terra Community Trust holds all of the intellectual property rights to TERRA, LUNA, and UST. … Through community proposals, each member of the Terra Community Pool may direct the trustees as to the use of the assets held. … The trust and trustees are managed consistently with the governance protocol of the Terra Blockchain and, with a few exceptions (i.e. no [f]raud or illegal or unethical actions), the trustees must manage the assets as directed by the Terra Community Pool through its community proposals. … If directed by the community, the trust has the ability to buy and sell property and enter into contracts, among other rights and privileges.

  • That all developers be encouraged to include in their proposals the cost, based upon quotations previously obtained, for any legal representation to outline any local and international law legal realities that their proposal may pose for them personally.

    • A copy of attorney legal opinions (including citations), although not including any personal information, be requested, but not necessarily required unless governance require it in discussion and the proposal specifies it (or by a separate proposal), to be passed along to governance

  • That all developers be encouraged to include in their grant proposals, the cost, based upon quotations previously obtain, any liability insurance, or customized bespoke insurance, to help provide the developer (or in some cases select others where appropriate) with legal defense on the sole basis of legal implications of their proposal (not including negligence, or abuse).

Anyhow, those are some of my initial thoughts (if helpful).

I hope you are doing well today :slight_smile:

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36

There is a reason businesses and celebrities spend millions just to find the best lawyer, i am very surprised of how many NO comments i see under this tread on a $20k spend proposal for a 1b chain. Let me just give you an example, 1 word can define the outcome of a court hearing. If you classify USTC as a stablecoin and they ban all stablecoins because they are securities (they are obviously not but thats SEC’s current narrative) it dewill be de listed from all the exchanges, if instead of that its called an algoritmic fungible token that is trying to mirror the $ its basically the same thing but legally/regulatory wise its not the same thing. (just an example)

Even Coinbase which is the biggest US exchanges is exploring options to move offshore because even tho they are trying to be 100% compliant with all laws they cant be because there are no laws YET. (if you haven’t you should go read their CEO’s thread on twitter on the timeline of events).

Another example is Kraken, they got fined $30m for offering staking a few weeks back.

But hey, lets burn the $20k instead, that will help much more.

Just my 2cents.

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37

Edward, I would appreciate it if you could clarify whether or not you supported the proposed burn increase or the amendment to the tax antehandler that could have increased the community pool. Without adequate funding, how can we expect to finance future projects effectively including this proposal?

Lastly, I am interested to know if there any further third parties involved in the decision making here. It would be valuable to have an AMA session where the community can ask you questions directly and gain a better understanding of your goals and vision for LUNC.

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38

[quote=“Tynos, post:17, topic:50463, full:true”]
Out of curiosity, why can’t be used those $4 mil sitting on a multisign wallet for those kind of actions including developers salaries?[/quote]

It could, if the community didn’t vote to put those assets into the CP

The funds were not recovered, but a process of finding new signers for the multisig wallet(s) is ongoing since the voting (almost a year now)

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39

Ed is moving towards what he always announced… all leaders lead with their own references.

Ed knows where to finance some projects in the USA.
It’s your personal reference and it’s where you’re seeing the path.

There are two possibilities regarding legislation.

1 - you join them.

2- you become so big that they join you.

  • More important than that will always be deciding what we are and what we are going to do.

If we are going to make declared strategic manipulations, in assets and in the market, we need legal framework.

If we don’t want to do overt manipulations on assets and markets and we just want to have the assets circulating and take care of the blockchain, we don’t need to.
There is always someone who works for a good handful of coins.

But it will always depend on our size as an ecosystem.

This year that we spent adrift was a great teaching.

I’d rather defy the legislators, I’d rather see an appreciation for my investment, preferably doing nothing and fast.

How likely is that to happen?

And how many years will it take?

I believed that terra classic was the right ecosystem for this to happen, but the last year has shown me otherwise.

For those who think we can be a new BTC, remember that BTC is the PoW that took 10 years to gain dimension.
Luna was created and managed by TG, Doxxed.
It is PoS and it was created as stablecoin algorithm.
currencies that everyone wants to be stable again.
What strategy will these stable coins be with, have you ever wondered that?

For those who don’t want legislation…
I think the answer will be more in terms of, is it if, we want to continue with ED, Zaradar and company?

It’s not out of malice towards these names, they are trying in their own way, but it is obvious that they don’t want to get involved before the law and they have every right. And it is also normal that they understand that the path of legislation will have a benefit. For what they really want us to be as an ecosystem.

In all cases you must respect the voting majority.
Remember everyone wants to make the ecosystem useful and valuable.

I already have my decision.

20k to listen to a path is about the same as what some members received for silencing people in terra rebels discord.

For that amount, I pay to see and know.

and if other teams do not appear with other proposals for decentralized enhancement, I will follow this team.

OBS: Memecoin-style rate increase proposals, I’m not considering any more…

:eye: :eye:

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40

edward kim replaced by ai

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41

“Horizons will provide legal representation for the Luna Classic DAO, including advice for individual contractors on the chain who may require legal assistance. Horizons will also advise the community and core team about strategies to mitigate regulatory risk that Luna Classic may face in light of the SEC’s recent enforcement action against Terraform Labs and from other relevant U.S. regulatory bodies.”
This statement in itself summarizes the prudent nature of the proposed engagement and of the necessity to follow through with the immediate recommendations if and when financially feasible.
Thank you @ek826 for taking the initiative in consulting with legal counsel and drafting/presenting this prop.

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As most of you are complete idiots with Stockholm syndrome, keep allowing this type of grifting right under your noses. I hope Binance delists and stops supporting LUNC after all these shenanigans from the so-called L1TaskForce -or should we call it GriftingTaskForce

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43

CZ talk to you about something?

Or did you dream, that he would support this conversation of yours?

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44

This community seems to be hellbent on torching community funds on things that at best are useless or at worst actively harmful. As it has been said, LUNC is a decentralized network not at the behest of any single country’s government. The entire chain is not under the purvey of the US government, and we should not go around granting this level of authority to a single legal entity. This is a waste of time and money just to cover the asses of so called devs who are unable to push an update without bricking the chain in a million different ways.

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46

I had to pinch myself to believe that this is real and that the comments before yours are what I am reading they are. This is sign of true mental illness. I can’t help but conclude this.

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47

@BasedTorontonian stop with the racism.

Ed has done great work for LUNC and the community. While I think having legal advice for the chain is a good idea, at this time I have issues with the advised DAO structure, and if this will lead to centralisation of decision making, undermining governance and the community vote. There is additional uncertainty regarding the AI side-chain project and whether the community will be funding this, but that should be addressed in the Q2 funding prop. Let us wait to hear from Ed more regarding these topics, but refrain from improper personal attacks.

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48

I have to agree with what others have said here, notably Arubasu, Jesusislord or Rabbi. I will not repeat what has been more eloquently stated, and will just redirect to their posts, they have valid points, concerns and questions.

I will just add that LUNC’s CP is not in a good position to engage in such proposals, as we paid L1TF and that their work will be done quite soon, and that we would then need to fund others initiatives or further important work on the chain.
We simply cannot afford to waste any funds in the CP, so they should be used very cautiously, and I am of the opinion that the SEC is not a tangible threat to LUNC at the moment.

It does indeed feels like the committee proposal all over again.
It’s a NO for me, and almost NO WITH VETO if more details are not provided later on

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49

hello @ek826 I admire your work and vision. Thanks to the L1 team, I can continue my investments in the chain. Binance has previously said that it can provide financial support to the development team if needed. maybe we can negotiate to use at least some of the burns for the expenses we need? thanks for help.

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Lots of questions, will try my best to address. Generally speaking, there is a war going on in crypto. As @RabbiJebediah has mentioned, it is primarily a war in the US and LUNC does not fall within the purview of the US justice system. The players in this war on both sides are behemoths, well financed, and already engaged in battle.
LUNC is much closer to this battle than other blockchains as evidenced by recent regulatory actions. If LUNC gets directly targeted, then it will affect the whole community. Yes, the community is decentralized and international and will live on without this, but some members of the community are literally sitting in a minefield and there are experts that have navigated this minefield before.

Now the essence of this proposal in the short term is asking the community to hire these experts to help those sitting in minefields so we can all move forward together as a community. Probably this only directly affects a minority of the LUNC community directly where the war is in their backyard, so I understand why others in the community may not want or care to get involved.

In the long term, @aeuser999 brings up some good ideas on how the relationships might work. It would be great to get these ideas in front of Horizons to see how it can be realized. As for the question of director and representation of the Cayman foundation, I am not asking to represent the foundation nor have any idea on qualifications. As for this being a move towards centralization, I can understand this sentiment. In order for the chain to enter into partnerships or or engage with other legal entities, there must be a legal entity on our side. I think centralization would be at higher risk if TGF were to be that entity as it was created and owned by me. But again, if the community deems that it is not a priority that the chain be able to enter into these engagements in this way, then I understand why this would seem unimportant.

@JESUSisLORD the images on their websites are not anon. If you hover over their picture, the image flips to their real faces. My understanding of the director of the DAO is simply to be a figurehead, not to make any decisions @godoal . The community through chain governance is the one to both appoint the director and it is the role of the director to do what chain governance decides, nothing more and nothing less (from my understanding).

@Kevin_Park i would probably say the post sounds strange because people filled in their own ideas of what my post left out with the idea that my “side” project is somehow misaligned with LUNC. To better address this, I’ve added an addendum to my article to help fill in these details as I see it in the short term. I believe it revolves around the understanding of how interchain accounts works and can be utilized. I think AI is a good utility play for LUNC, ultimately, when it comes time to integrate the chains via ICA, it is up to the community to decide if they want to allow LUNC to be the controller chain. Also, the law firm made lots of edits to the original language.

@tapan_bhatt yes part of the discussion is how to navigate the UST minefield and what that looks like.
for the legal costs, I believe it seems very reasonable to ensure compliance seeing that Sushiswap just asked for $3M after getting subpoena’d.

In summary, we are all part of the lunc world. Theres a war in a part of this world, and this proposal is asking if the countries of the lunc world, short term, want to send the troops or not, and long term setup official camp in the cayman islands.

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