I have edited the following update into the main post to reflect the changes we discussed over the last few days.
Edit: 14th May Proposal Update
After a long community discussion surrounding this proposal (over 700 comments), I have reviewed multiple perspectives from multiple stakeholders and we have decided to make three major amendments to the original proposal. This will make it a near-perfect solution.
Only initial deposits made into Anchor will be eligible for the refund, not yield. This will free up a decent percentage of capital which can be redistributed to more people. We should prioritize giving back people the money they actually put in, and refunding Anchor profits would cut into that. This can easily be calculated on a per-wallet basis using the methodology from this tool. Put simply, if you put 20,000 UST into Anchor last year and now have 24,000 UST, your refund amount would be capped at 20,000 UST.
All forms of UST on Terra would count in the first refund batch, including UST staked in LPs and pools like Osmosis. I received feedback from a lot of users that had their funds staked in these services, so we will not limit refunds to just Anchor and vanilla UST - it will include all UST balances on Terra across all services (as long as they can be tracked on the blockchain).
Instead of paying out just small wallets, we will pay out all wallets, including whale wallets, up to a set cap per address. This solution seems to be a good balance between including whales and having more money to make smaller players whole. It will cut into the per-wallet amount by quite a bit, but it is a more equitable solution and mirrors real-world refund setups like FDIC insurance and bankruptcy proceedings. For example, with a hypothetical per-wallet cap of $50,000, someone with $5,000 in Anchor would receive the full $5,000 as a refund, and someone with $800,000 would be limited to a $50,000 refund. We should still be able to clear out debts for most Anchor users depending on how much money LFG has left.
Thank you to everyone for their suggestions and helping me amend this proposal to make it more equitable and reasonable. It is now likely the most realistic and most beneficial solution out there, and I hope TFL is able to join the conversation.
PS. I have changed the title of this proposal from Tiered repayment: airdrop USDC/USDT to small UST holders on Terra to Tiered repayment: 1:1 USDC refund to all UST holders up to a certain cap per-wallet using LFG funds, favouring small wallets. This better reflects the spirit of the amended proposal.
They have deleted the lawsuit thread can you create a discord and Twitter for lawsuit group so everyone can join?
It would be easier to onboard everyone now as luna is hot topic vs weeks/months later when it dies off.
They are planning to pull a soft rug but we should not let that happen.
This is the best solution so far, everyone talks that Terra ecosystem had the best community, if we want to keep it from falling apart then regaining trust of as many members as possible is the only way.
Your work, efforts, and organization of all of this has been great man.
Do you think there’s a viable path to getting this done? It was disheartening to read that Kwon Do basically wants to abandon UST which kind of feels like he wouldn’t be for a solution like this. Seems more like he wants to cut UST clean from the ecosystem and just restart Luna.
I guess I’m just wondering how feasible it is that the community can make something like this proposal happen? Us UST holders didn’t sign up for holding Luna, which seems to be what Kwon is pushing to happen. Instead of getting our dollars back we get a speculative asset with no backing that essentially has no value.
Your proposal is clearly popular, and for very good reasons, I think the community at least deserves an official response by the team to your proposal. We know Kwon read your proposal, since he accidentally linked your post in his tweet. The team needs to give us some kind of official response to this proposal and the other popular proposals gaining traction.
I’m a bit time limited to lead that effort (in my last quarter of college and graduating soon!) but I have the top post on the Anchor subreddit and it hasn’t been censored so far. It’s quite popular and I posted an update there about the potential for legal action to be taken by the community if necessary. I’ve also posted the latest changes to the proposal for people to see in the comments.
In terms of actual restitution, my proposal is the most viable and I genuinely think it can be put into place. I have thought a lot about every aspect and this can definitely work.
We can pray that saner heads prevail at TFL. Do Kwon has publicly flip-flopped on his position (remember when he told everyone he would collateralize UST? What happened to that? Was that just for an exit pump?) so I don’t see why they can’t change their mind again.
In any case, even if TFL chooses to ignore this proposal (which would not be wise…) and they get sued, a court would likely come to a similar plan. It would just take many more years for us to get any money.
This proposal is 100% for UST holders and 0% for LUNA holders (pre-peg, pre-halt, post halt, although the post-halt ones are feeding on the suffering of the others).
This is a solutions for simple brains. Have you guys taken a look at the proposal “8-steps-to-save-luna-now-economic-refactoring-proposal-from-industry-professionals”?
It’s suggested by a team with strong economic background.
No argument from authority fallacy here - I would prefer to judge each proposal on its individual merits rather than who wrote it.
The 8 steps proposal has some incredibly flawed ideas. Any proposal that includes the ‘buyback and burn’ of current LUNA tokens as any form of remedy isn’t well thought out.
With just $1B, and Luna price of $0.003 a staggering 333B LUNA can be bought back.
This will strongly benefit new buyers who picked up billions of LUNA for nothing. The people who actually lost money (LUNA buyers from $50 to $100) will receive nothing at all, because their coins are still worthless. There is no actual reward for real victims.
(Raise external fund with partners and institutions and use that as a separate economic pool to buy back and burn LUNA at constant rate).
Much of the proposal is based on long shots like this. What VC firm is going to throw billions at LUNA? TFL had deals lined up and every single one fell through. No firm is going to touch this with a ten foot pole.
Enable tiers on Anchor and bind the Anchor earn economy with Luna demand
The proposal fails to acknowledge that Anchor in its old form doesn’t actually exist anymore. It’s not a functional product. It’s not paying out interest. UST is broken so deposits mean nothing. You can’t use a dead product and a dead stablecoin to revive a dead speculative cryptocurrency. You need something that actually works.
Put the CAP of UST at 20B UST , which could be changed only with governance vote. The cap will enable a deflationary nature of UST and facilitate stronger demand for it.
Again, this does nothing because there is no money propping up UST. Billions are stuck in the UST machine. What is the point of capping the mint if UST isn’t even at $1?
The whole thing is just silly, and these are just a select few of my criticisms. There is a lot to unpack since it’s a long post but I won’t spend too much time on it. I have outlined several times in this thread why it’s important to prioritize UST holders, who took on far less risk (they had zero upside when they bought a $1 stablecoin for $1) compared to LUNA buyers who were getting into a volatile, speculative altcoin that was specifically designed to support the UST peg.
Under this proposal, we will come up with a set cap per wallet based on how much money LFG has left. Hypothetically, say it’s $50k. You would then need to buy back 50k UST on the open market and return it to the refund wizard. You’d be able to get $50k in USDC back. You won’t get the full $970k, unfortunately.
What I think Luna holders need to understand is that us UST holders were sold an idea of UST being an alternative to the dollar and a safe alternative to a savings account. We didn’t sign up for holding a speculative asset, too many of the proposals here cut UST out entirely and either reward us with a speculative asset we didn’t ask for or just tell us we need to take a gamble on the community that we weren’t really a part of.
Luna buybacks and rollbacks won’t actually return your money to you. Luna was a speculative asset that now has lost trust, it would take years for Luna to win over speculators again if it ever can. I think too many people here have the impression that with a few steps the team can return Luna to its old price of $80+.
UST holders were promised that 1 UST would equal 1 USD. We were sold on the idea of stability and that this was a safe and viable option to holding USD. To cut us out of a plan and to not at least attempt to make us whole is borderline fraud (if not outright fraud) and would leas to the Luna Foundation dealing with future class action lawsuits that would drag on for years.
Yeah, I’m not a fan of the ‘punish people based on when they withdrew from Anchor’ model, because it makes too many assumptions. What about people who didn’t sell at exactly the same time of their withdrawal? What about people who took their funds off-chain and are still holding?
This sounds right! Me and my gf are some of these small holders that are affected in a life changing way and for us this would be a massive turnaround of the events. Big whales calculate that as margin of error and move on but for us shrimp this is a life changing loss.