[Proposal] Rebalance between hard core hodlers and new buyers

I would suggest to mint another let say ~10-50% of luna supply and distribute that proportionally to those luna hodlers who on chain hold now and also held before crash. So true believers are rewarded.

This should rebalance holdings between hard core hodlers who held despite 2000000x retrace and heavy inflation and those who bought after. I guess new hodlers who bought in insane discount could swallow another 10-50% supply expansion for the sake of saving the project (after all they are also the believers right?). I see completely no problem having trillions of supply, its just unit of measure.

Community pool should be also part of rebalance as whole development will stop if original pool just evaporated due to inflation.

Additional mechanics to prevent quick liquidity withdraw in the future should be implemented and also perhaps as some people suggested put some burning fee 0.5-1% to onchain transactions to create some scarcity over time and reduce inflation rate.

What @dokwon is suggesting (Terra Ecosystem Revival Plan) will imho fail immediately after creation. Giving back 40% money to people who possibly sold after the depeg is terrible idea. Giving 40% money to UST hodlers is also terrible idea - repeg should automatically be established after luna economics is fixed and anyone who held through crash should be able to withdraw 100%. Those who sold in crash, well sorry to them. But they did not held life savings in UST out of their good heart … they did it so they can have 18% APY on anchor (btw this should be also lowered to more reasonable percentage). Giving 10% money to luna hodlers who held during some specific moment seems also very uneven as trading is still ongoing, this one smells quite fishy … not to mention legal consequences of fork and robbing some investors of everything, possible de-listing of exchanges,… lets not do any snapshot reset please.

Note: I did not hold luna before crash. I did dca through the crash and would have no problem giving old hodlers (those that did not sell) new chance. For me it would mean just another chance to buy even lower. Anyone who bought after the crash should share this sentiment as without any redistribution project will just end. This crash was not ordinary crash, it was crash within the crash of another crash… lets be nice to each other.

Edit (to answer some comments bellow):

My proposal to reward ‘holding’ during inflation should be general coin mechanics affecting everyone (since some block). Not just this particular event.

Problem is, that from gaming theory point of view, in case of inflation, best thing to do is sell everything and buy lower. This two facts ‘everybody selling’ and ‘supply expansion’ compound and contribute to price collapse which draw luna liquidity much quicker compared to the system in which people would be incentivized to hold during the inflation event.

Current inflation mechanics:

  • 10 people each holding 10 coins worth of 1usd (total 100usd), average hold per user is 10usd
  • someone mint 1000 coins (exits out of ust)
  • new supply is 1100 coins, total value did not change (100usd), coin new value is 0.09usd, everyone (besides the minter) holds 0.9usd (everyone lost 10x) → everyone has incentive to sell during this type of events

Example how redistribution could work:

  • 10 people each holding 10 coins worth of 1usd (total 100usd), average hold per user is 10usd
  • someone mints 1000 coins (exits out of ust)
  • actually 1900 coins are minted, 900 are distributed to holders (everyone eligible gets 100), minter gets 1000
  • new supply is 2000 coins, total value did not change (100usd), new coin value is 0.05usd, everyone (besides minter) holds 5.5usd (everyone lost ~2x) → you would think that people are still incentivized to sell, but read further
  • if you sold during this event and are not eligible for redistribution you probably only sold for 0.5usd as that was value of your holding (unless you did front-run the minter - but you can do that even currently, most of the people will not be able to achieve this)
  • so even thou you are still loosing value during inflation, it is much better to just hold then to sell
  • you still can benefit from inflation by buying cheaper, but price drop caused by the inflation will not affect your current holdings that much

Actually if it worked like this, it would cap losses incurred by any inflation to 50% (compared to current case 99.995%). Additionally as you might notice, minter (or in general minting during high inflation) gets actually less attractive as coins are worth less than they should be (0.05usd vs 0.09usd) at that particular time. This is caused by the fact that minted supply was big multiply of previous supply. If you only mint reasonable amount compared to actual supply, this difference is negligible. This would therefore discourage high liquidity withdraw from the system. It would be better to wait with minting to time when not so much people are minting or spread your minting as such that minted coins are always just small portion of total supply. You as minter gets the benefit to sell the coins first as everyone else would need to wait if they don’t want to loose their redistribution compensation.

Note that this mechanics will be in most cases pretty much invisible as nobody will care about small pieces if inflation is very steady. But it will become visible when huge amounts are minted. This mechanics will not prevent crashes, but it will help during the crashes which are caused by excessive minting.

I am sure there are lot of technical details and special cases to sort out, this is just very rough idea of some inflation compensation which should incentivize holding during inflation, discourage too large liquidity withdraw and possibly prevent this type of crash in the future - because regardless how well you did dca currently, if the excessive coin minting starts again, everyone will loose everything again.

1 Like

So you are trying to say that people who hold Luna off chain are non believers?


Like who? People who held on exchanges? Those will be included as exchange would receive part of the rebalance as it would be considered as ‘previous hodler’ as it received money onchain before the crash. Exchange should then redistribute that money to relevant users accordingly (if they did not sell). I guess it can get quite complicated, but should be doable.

Basically if there is any technical way to determine who held everything since before the crash until now, it would count. I am just not aware of any other technical way detrmining this. If there is a way … it should count.

Better than Do whatever plan that clearly massively benefits him. I think a Transaction fee to help burn is a good idea as well, mabye change the mechanisim that creates Luna and UST to burn more than needed in some way as well. Personally I’m a fan of natural growth, and Do whatevers plan to artificially create value just gonna lead to another massive selloff imo, and is kind of a slap in the face to a lot of people.

1 Like

It might be hard because of all the different tokens for all the other networks and the wrapped tokens as well. I heard someone claiming it be near impossible but idk.

1 Like

Wrapped tokens should also count if they were not sold during the crash.

There is a flaw in that concept… minting more coins does not create new value it will dilute existing value… Yes you’ll make more coins but the value of each coin further decreases… at the end of the day it makes no difference having 1mil tokens priced at 0.00001 vs 100 coins priced at 0.1.

1 Like

Point of this is not to create new value, but to redistribute existing value. Even if there was no panic and price would contract just exactly as supply expanded, original hodlers would loose everything. Note that price fell 2500000x and supply expanded ‘just’ 20000x. I believe there is room for generosity from new buyers … after all they can buy lower if price contract more after this. But will it? Giving reward to hard core believer that did not sell despite of everything does not necessarily lower the price. Also how much should be redistributed can be point to discuss. If system can survive without any redistribution then fine, lets not do anything. But if project will just fail in that case … then I guess this could be helpfull.

If price goes to zero everyone loses everything regardless of buying price. If you buy BTC at 1K and another person at 60K and then BTC crashes to 10K are you going to do a redistribution of value? The value of each of our coins is reflected in our respective wallets and that’s how decentralised system is supposed to function. I lost money too but I DCA’d heavily to put myself into positive… everyone had that option.

1 Like

Difference is that BTC did not expand supply 20000x during that time. This wasn’t just crash because of panic sell. Extreme supply expansion was big part of this. Validators should have stopped it much sooner to let system stabilize. But if price is falling 100x every day there is no way to save the system without intervention. You did dca (just as me) but if system wont survive or some mindless fork is done everyone looses money. My suggestion was attempt to compensate people who suffered from massive inflation in some reasonable way. And I do understand that making another 50% will make situation even worse, but it is nothing compared to 20000x.

How would you call someone who did not sell anything despite this carnage?

They should have halted is the key word. But they didn’t, instead DO was building encouragement on twitter for investors to go out there while inflating coins… whose fault it is?

1 Like

Well, whole thing was not very transparent that’s true. I just fear that if nothing is done, then we just do dead cat bounce and project will be over. Nobody profits from that.

LUNA can operate at any price depending on coin circulation. The issue are the old buyers aka their own wallets, friends, dev etc… and now they want to take value away from investors to refill their loses. That’s the only goal as far as the proposed plan is concerned.


Well, I guess we can also just do nothing, let existing UST liquidity exit, which will retrace price couple million times more and start from there… luna will make news as greatest crash of all times … its already quite impressive. So what is your proposal?

My proposal is to use LUNA as the currency similar to ETH for Ethereum ecosystem and payoff UST Holders money over time… UST is a flawed concept and cannot function in its present form. They can also adopt other models where UST is backed by USD and LUNA acts as the token similar to NEXO coin.

If any losses needs to be paid then Terra should either pay out of their own pocket or pay it off slowly overtime once they grow again. Any idea to take other investors money to salvage losses is a convenient theft when the entire fault is theirs.


Well I had some LUNA before crash. On the beginning of the “crash” I bought for 100k dollars around 4000 LUNAs. Right now its worth perhaps 30 cents. So whats the difference between me who bought with average price $25 and some other investor who bought LUNAs for 100k dollars with average price $80. He may be holding 1200 LUNAs, I hold 4000 LUNAs. We both lost everything. And now you want to offer the second guy free coins (or whatever) and Ill have to live with loss becouse I bought 60% cheaper then him? Well thats not fair solution at all. There are only 2 fair solutions in this crisis:

First one:

Second one:


That’s been the only solution all along. Burn supply.

1 Like

Apparently the managers don’t know who the important people are, the people who used to be penniless and LUNA is dying, the people who are buying now are your dads, you have to get more people to buy, you have to first Resurrection, you LUNA is qualified to save the previous people! And you’re trying to drive away the people who are buying, you want to resurrect UST, that’s a result no one wants to see, you should know that if no more people buy, you’re gone forever!

1 Like