[Proposal] - Terra revival plan without going back to older version

I am not a developer, nor have full knowledge of how the system works but trying to find ways to go back will not work. (“I m just a poor guy from a poor family” Queen)

If we compensate investors who took the responsibility to enter a RISKY market, it will only result in the mass sellout once they get compensated.

Instead, we must look into a sustainable solution that will keep Terra ecosystem alive.
Since this was somehow a result of an “attack” with a vulnerability to the algorithm (that you have been warned many times) why dont you add a mechanism that will burn on every sell/short.

Burning proportional amount of shorting in that stage should keep the price stable or at least prevent rapid falling.

So we have 6.5 T Luna that must be burned till a reasonable level and whales waiting to repeat the big selloff. This mechanism will be burning big amounts of Luna everytime someone wants to exit, leaving less Lunas and increasing the price whenever more investors are willing to enter
(increased demand increases the price, increased supply decreases the price. Basic rule of supply and demand)

So eventually the demand will be increasing and any short position will be burning more Lunas to keep the price stable.

At this stage you can always use the Pool fund and further increase the demand of the Terra.



can you please clarify the process how this burning should happen? An idea would be to use the swap spread for buying luna?

Using the swap spread does not reduce the amount of Luna. It just recycles the buying process.

Price cannot increase as long as there are trillions of lunas out there.
It went from approx 400million to 6.5 Trillion meaning that at the current circulation, market cap is (approx. for simplification)$1.5 billion with the existing price of 0.00025

So, with the current circulation we get:

$6.4 Billion if price goes 0.001 (which is very possible)

$63 Billion if price goes 0.01 (which is unlikely because Lunas maximum market cap reached $30billion on the good times.

$636 Billion if price reaches 0.1 (Shiba Inu senario. Not gonna happen, period. )

So there is no point hoping for the $1 with the current Circulation because it will require a $6.3 Trillion and even if the whole world contributes, it is still not enough.

Cutting the circulation to half is not enough either, because you still reach to $30 billion on $0.01 price and it wont go further.

Golden line could be a fixed circulation of 1Billion Lunas. (3 times more than the pre-crisis circulation) and then reducing further the circulation when price reaches to desired levels.

This can give us:
$1 billion market cap if price is $1 (very reasonable)
$10 billion market cap if price is 10$

Then reduce circulation by burning 25% (so staying with 750 Million Lunas that will give us $18.5 billion for the price of 25$ (absolutely logical levels)

Burn again 250 million Luna till you reach 500 Million (still much more from the circulation in the pre-crisis era).
You shall get $25 billion with a price of $50 per Luna (well this is also realistic).
And then you drop down proportionally, unless there are further investments that can provide and maintain higher market cap.
As last example, we could have $40 billion market cap with a price of $100 per luna and a supply of 400 million Lunas.

BUT. There is no chance this to happen if all go greedy and keep their Lunas.
Since most investors bought millions of Lunas for the fraction of the price, the only way i see it, is to reduce the Luna from each wallet, so the burning happens proportionally (don’t dream of becoming millionaire just because you bought 1 million Lunas for pennies. You hold a chunk of the supply that must be burned).

So the way i see it. We FORCE the burning (yeah, democracy does not work when we need to save a situation) of each wallet down to 636500%
So anyone who holds 1 million Lunas, will end up having 157.

Wow, this is stealing, you would say.

But no, this will make you richer, since your current million Lunas have a value of $250 while if we do the sacrifice, your new value with the 157 Lunas will be:

$157 if price goes $1 (easily)
$1570 if price goes $10 (at $10 billion market cap this is very realistic)
$7855 if price goes $50 (at $25 billion market cap still very realistic).

And here we are with the last problem.
If we reduce that huge % from all wallets, it will also affect the investors who had thousands of Luna before the crisis and never took advantage of the low prices (mainly because most of them got liquidated).
It would be really unfair cutting them anything while they invested thousands comparing to those who just added a fraction.
Here will help the part where the validators can confirm how much Lunas each wallet had BEFORE the crisis and deduct the equivalent proportion from their current wallet.

This does not mean, that who ever sold all their Lunas and owns nothing, shall get back to the previous level (unfortunately its not a charity solution we are looking, but putting the faith to a sustainable revival).

And all the above is not linked with the connection of Luna and UST, but you got the logic.
I am sure @dokwon and his #lunatic team have great minds that can work the math.

If you managed to read until here, you are my hero :face_holding_back_tears:.
Please hit a like so others can see it as well.

1 Like