$USTC↔️$INRT↔️$USDTR Repeg & $LUNC Revival Plan/Proposal

Governance & Proposals
1

I have now completed the proposal according to my satisfaction and I feel it is at a position that it can be put for a vote.

I have addressed all concerns and feedback that came to me over the course of the last few days after publishing the proposal, and I have ensured that I make this a proposal not just for $USTC holders, but for the entire Terra Luna Classic ecosystem in which $LUNC holders would benefit the most.

I have added the following sections to the proposal after my first post on this thread (the changes have also been made in the Dropbox Paper document):

  • Stability & Precautions (which deals with how the peg is maintained)
  • Community DEX (a complete system that re-enables swaps and arbitrage trading)
  • Wrapped Stable Tokens (WSTs)
  • Liquidity Pools
  • Frequently Asked Questions (FAQs)

NOTE:

This document is best viewed on a desktop with a minimum resolution of 1920x1080px. However, a PDF version is provided as well for offline view.

(RECOMMENDED) Online Version URL:
https://www.dropbox.com/scl/fi/cklwxyamvcaqph3dq63q7/USTC-INRT-USDTR-Repeg-LUNC-Revival-Plan_Proposal.paper?dl=0&rlkey=80x0ib5r2x1tbmfciq7s7i0qd

Offline PDF (ATTACHED and also) available at:

This document is divided into smaller components or sections that can be browsed using the bookmarks on the left (if viewing on desktop in the Dropbox Paper application).

It is a request to take the time to go through each section in detail. I have included a TL;DR of the document in a section but it is much better if all voters went through the complete plan/proposal.

P.S. This thread continues from the following thread on the same subject:

I just tried to post this as a comment on the original thread but Agora is not allowing me to post such a large body of text there so I am posting this as a separate thread. I will attach links to both threads while putting this for a vote.

Since this proposal is too large for Agora, I will post the FAQs & Notes separately after some time in the comments.



$USTC↔️$INRT↔️$USDTR Repeg & $LUNC Revival Plan/Proposal

Introduction

1 $USTC is currently 98% below the peg of $ 1 USD, but 1 $USTC is 64% above the traded value of 1 INR (Indian Rupee, represented using the symbol ₹).

INR is the official currency of my country and it is 82 times lesser than a dollar.

In other words,

$1 USD = approx. ₹ 82 INR

So,

1 $USTC = $ 0.02 = ~ ₹ 1.64 INR

It may not be possible to repeg $USTC (without a complete buyback or reverse split of the blockchain) since it is 98% below value, but it is definitely possible to issue a stablecoin that can only be bought using $USTC and/or other de-pegged stablecoins.

  • In this plan, neither is a reverse split required, nor is building any complicated modules required

In fact, a stablecoin can be issued on the Terra Luna Classic blockchain pegged to the Indian Rupee INR backed 100% by reserves.

The following block diagram describes the complete ecosystem which will have to be designed and developed in order to repeg $USTC.

Fig 1: Complete $USTC↔️$INRT↔️$USDTR Repeg System

Although the block diagram above is represented as a singular unit, it is in fact divided into 5-6 modules, 3 different processes and 2 interconnected group of specifications.

I will attempt to describe the complete process in layman terms so that the process and the work required to be done is understood by technical as well as non-technical members of the community. I will limit myself to using technical terms as much as possible in this document.

What is $INRT

$INR-Terra or $INR-T, abbreviated as, $INRT is a native stablecoin of the Terra Luna Classic ecosystem pegged to 1 Indian Rupee (₹).

  • $INRT is the first truly decentralized trustless stable cryptocurrency coin in the world

$INRT will be issued on the Terra Luna Classic blockchain, developed and maintained wholly by the Terra Luna Classic community.

$INRT shall NOT be legally undertaken by TFL, Do Kwon and/or any other entity, team or individual currently represented in the Terra Luna Classic ecosystem.

$INRT shall be developed and maintained ONLY by the developers of the Terra Luna Classic ecosystem.

$INRT shall be governed by the Governance process (gov module) of the Cosmos ecosystem and a separate governance portal and discussion forum will be made available to the community members to govern all affairs related to $INRT.

Tokenomics

  1. $INRT shall be issued on a strictly on-demand basis and there shall be NO airdrops issued to participating wallets
  2. $INRT shall NOT be airdropped to “pre-crash” wallets indicated in the snapshot before the crash of Terra-Luna
  3. There will be absolutely NO KYC permitted while issuing $INRT by any entity which requests for $INRT to be issued

In order for us to be able to issue $INRT on the Terra Luna Classic ecosystem as a native token that has a value, we require a $USTC pool that shall be converted to an initial $INRT pool.

Total Value of $USTC Pool required (as initial investment) - 3,000,000 $USTC

Value of 1 $USTC - $ 0.02 USD

Value of $ 1 USD (in Indian Rupees) - ₹ 82

Thus,

Value of 1 $USTC (in Indian Rupees) = 0.02 x 82 = ₹ 1.64

Total Value of $USTC Pool (in Indian Rupees) = 3,000,000 x 1.64 = ₹ 4,920,000

Since, 1 ₹ = 1 $INRT,

Total Initial Supply of Tokens - 4,920,000

Value of 1 $INRT (in $ USD) = 1 ÷ 82 = $ 0.012195 USD

NOTE:-

  1. The above is a representative figure for the number of tokens issued initially since the total number of tokens will depend upon the total investment available for the investment during the launch of the token sale
  2. The actual number of tokens issued will be slightly lesser than the calculated number since there will be some consumption of gas fees in the process of moving the $USTC and issuing the tokens for the initial token sale
  3. A separate whitepaper shall be released in the coming weeks in which the complete $INRT ecosystem plan and possible applications of $INRT will be described in details

$USTC is being used as an example in the following sections to describe how the system would function with $USTC as well as the other 22 de-pegged currencies.

Conditions/Constraints/Specifications

The specifications below have been divided into two separate sets to understand how they correlate with each other and how the process flow of the system works.

Although it is in no particular order (since this is a decentralized system and all processes work parallel to each other), the following specifications describe the general conditions under which the system shall operate.

Specification Set 1

  1. $INRT can only be bought in lieu of $USTC and/or other stablecoins issued on the Terra Luna Classic ecosystem
  2. $USTC and/or stablecoins issued on the Terra Luna Classic ecosystem create the reserve pool required for $INRT, when $USTC and/or other stablecoins are traded/swapped for $INRT
  3. Since $INRT is a stablecoin, the reserve pool has to be maintained 1:1 with another asset class that will balance the number of $INRT tokens being issued in exchange for $USTC and/or other stablecoins
  4. Instead of maintaining this reserve pool as fiat (in a bank), we will maintain this reserve pool as a transparent blockchain reserve asset class of $BTC and $ETH
  5. When we exchange $USTC for $BTC+$ETH, some other wallet would be buying an equivalent value of $USTC from us which remains in circulation and in the buying wallet
  6. Since it is assumed (in Point 1) that the buying wallet has bought $USTC to exchange for $INRT, during the time the $INRT is being issued to the buying wallet 0.1% fees will be deducted to burn (buy-back) an equivalent amount of $USTC and 0.1% additional fees will be charged to be sent to the Terra Luna Classic Community Pool for funding development work on the blockchain
  7. If the buying wallet instead stakes the $USTC with us (details in Specification Set 2), then the process flow will follow from Specification Set 2, otherwise, buying wallet will follow process flow from Specification Set 1 Point 5 again

Fig 1: Complete $USTC↔️$INRT↔️$USDTR Repeg System

Specification Set 2

  1. Rewards for staking $USTC with us will accumulate yield as $INRT, avoiding flooding supply of $USTC in circulation during rewards withdrawal
  2. Staking options for $USTC will be enabled with Auto-Compound (every 24 hours) and a lock-in period of 12-36 months (stakers will not be able to unstake before 12 months)
  3. While unstaking $USTC or claiming rewards as $INRT 0.1% fees will be deducted to burn (buy-back) an equivalent amount of $USTC and 0.1% additional fees will be charged to be sent to the Terra Luna Classic Oracle Pool for rewarding stakers on the blockchain
  4. No fees shall be deducted for the Auto-Compound function

The conditions or specifications described above have been translated into a block diagram (below) so that the process flow of the complete system can be visualized together.

Process

The complete repeg system described above can be subdivided (for sake of simplicity and understanding) into three separate parts of the system.

I have attempted to view and describe these parts individually and have provided details of each part under the following heads.

NOTE:

  • Part 1 and Part 2 are separate processes
  • Part 3 is a common process for both Part 1 and Part 2

Part 1 - The BUY Process

Fig 2: Part 1 - The BUY Process

Process Starts At: IN

Process:

  1. Buying wallet provides liquidity to our $USTC Pool

  2. Equivalent value of $INRT is calculated and issued to buying wallet

  3. While buying $INRT,

  4. 0.1% $USTC is sent to Burn Module

  5. 0.1% $USTC is sent to the Terra Luna Classic Community Pool

  6. $USTC from buying wallet is sent to Buy Module to exchange to $BTC+$ETH Reserves

Note - For sake of simplicity I have not shown the Burn Module here, which has been explained in Part 3.

Part 2 - The STAKE Process

Fig 3: Part 2 - The STAKE Process

Process Starts At: IN

Process:

  1. Buying wallet stakes $USTC (provides liquidity) to our $USTC Pool

  2. If $USTC is Unstaked coins move OUT of the system

  3. While Unstaking,

  4. 0.1% $USTC is sent to Burn Module

  5. 0.1% $USTC is sent to the Terra Luna Classic Oracle Pool

  6. If $USTC is Auto-compounded coins go back into $USTC Pool

Part 3 - The SWAP Process

NOTE:-

This is an INTERNAL swap “process” and has NOTHING to do with the Cosmos swap module (which is part of the bank module) that is currently defunct (market swap) on Terra Luna Classic.

THIS IS NOT A SWAP MODULE. THIS IS AN INTERNAL PROCESS TO DESCRIBE HOW $USTC IS CONVERTED TO $INRT AND APPLIES DURING BUYING AND UNSTAKING

Fig 4: Part 3 - The SWAP Process

Process Starts At: $USTC POOL

Process:

  1. Buying wallet sends $USTC to Burn Module
  2. Buying wallet requests to receive $INRT for $USTC
  3. $USTC is sent to Burn Module
  4. Remaining $USTC is sent to Exchange
  5. Reserves are created in $BTC+$ETH
  6. $INRT is issued to buying wallet
  7. Buying wallet sells or stakes

Modules

The plan has been divided into 2 sets of Specifications and 3 Parts of a parallel process system above which make up the high-level design of the system.

Now, we shall further divide the system into 6 different modules for a low-level explanation of the technical aspects of the system and to understand better what is required in order to code and execute such a system.

Module 1 - BURN Module ($USTC L2)

The Burn module is a misnomer for the function of this module, since a burn is simply a buy-back in the technical sense of the term, and a burn would entail to sending the coins to a zero address coded into the blockchain.

Such an address generally exists when a blockchain on Cosmos is instantiated with it’s genesis configuration file and should exist for $USTC as well.

Burns can be alternatively implemented by converting $USTC to a CW-20 token and then burning the token.

Module 2 - STAKE Module ($USTC L2)

The Stake module is simply a liquidity pool provider and handler. It does NOT cut the supply of $USTC directly since staked $USTC will be used to provide liquidity for the swap functionality in which buyers can make instantaneous swaps at market price between $USTC and $INRT.

We are already burning a substantial supply of the $USTC while unstaking and buying $INRT. This process does not require the development of a L1 staking module and can be handled completely on L2 functionality already present on the Terra Luna Classic blockchain.

Module 3 - BUY Module ($INRT L1/L2)

The Buy module connects to the $INRT Pool to issue $INRT tokens to the buying wallet. This module would already be present when the new $INRT blockchain is instantiated so there is no development required to build it specifically.

This buy module will enable $USTC to be sent to the $USTC Pool and track exactly how much is to be issued to the buying wallet. It will confirm the transaction when the equivalent value of $BTC+$ETH has been exchanged into the Reserve Pool, securing reserves 1:1 for the $INRT being issued to the buying wallet.

Module 4 - SWAP Module ($USTC L2)

As described before this, the Swap module is simply a common functionality to both the Buy and Stake modules, which is required for both modules to function properly.

This Swap module will enable $USTC swaps to $BTC+$ETH and track both issued and issuing wallets for confirmation of transactions on both the $USTC chain as well as the $INRT chain.

Module 5 - $USTC Pool ($USTC L2)

The $USTC Pool is one of the most important components of our system since it will be used to issue the initial set of tokens for $INRT which will be the first stablecoin correctly pegged to a currency after the Terra-Luna crash.

The initial investment required to create this pool has been described in the Budget section.

Module 6 - $INRT Pool ($INRT L1)

The $INRT resides on the $INRT blockchain and it is separated from the Terra Luna Classic community via a separate governance portal and discussion forum.

Tokens will be issued to holders in lieu of an equivalent amount of $BTC+$ETH which shall be held in reserves.

Thus, this $INRT pool of tokens issued during the creation of the blockchain will be inflationary in nature and new tokens will be issued/minted according to reserves we hold 1:1. This is similar to holding reserves in a bank in fiat, but in this case, we are holding it in a wallet in $BTC and $ETH.

Stability

$INRT is not an algorithmically controlled stablecoin. It is issued like any other cryptocurrency and traded at exactly ₹ 1 Indian Rupee.

$BTC (Bitcoin) and $ETH (Ethereum) will be held 1:1 as Reserves to issue new $INRT coins.

Minting is not permitted on the blockchain and the minting function will be deactivated for $INRT while it is being issued on the mainnet.

There is no method/function to issue new coins which will be made available to programmers to use via a SDK or API.

$INRT can be traded for only the following 23 currencies which exist on the Terra Luna Classic blockchain currently:

uaud, ucad, uchf, ucny, udkk, ueur, ugbp, uhkd, uidr, uinr, ujpy, ukrw, uluna, umnt, umyr, unok, uphp, usdr, usek, usgd, uthb, utwd, uusd

Please Note:- “u” before the name of the coin indicates “10 to the power of minus 6” = 10*-6* = 1÷1000000

Precautions

The following table describes the precautions the system takes in order to prevent a situation like a death spiral while providing enough buffer reserves (and emergency buffer reserves) to safeguard against any unforeseen market fluctuations or abnormalities:

image
image780×471 19.9 KB

Note:- The table above is the TL;DR version of this proposal/plan since it describes in brief how the peg to 1 Indian Rupee is kept at exactly 1 Indian Rupee, and how LUNC is burnt as a result of the functioning of this system/plan.

Community DEX

Although the following construct was not originally designed to be a DEX (since it is an extended explanation of how the system functions), it has now developed into what can be described as a decentralized exchange system, in which we can exchange, trade and swap between various currencies and forex traders may use the system as an arbitrage trading platform as well.

Fig 5: Complete Design/Architecture of the Community Dex

Wrapped Stable Tokens (WSTs)

While the concept of WSTs would probably demand a separate whitepaper on the subject, to understand the diagram above, it is essential that the reader understands the concept behind WSTs.

This is not a novel concept since wrapped tokens exist, like $wBTC and $wETH, which are pegged 1:1 to $BTC or $ETH respectively.

What we are introducing for the very first time to the Terra Luna Classic ecosystem (and potentially for the first time to the Cosmos ecosystem) is a concept of Wrapped Stable Tokens or WSTs which are pegged to the currencies that each represent.

For example,

1 $USTC is currently at a de-pegged value of ~ $ 0.02 USD

Or,

50 $USTC = 0.02 x 50 = $ 1 USD

We can issue a token which resides on the Terra Luna Classic blockchain that wraps 50 $USTC into 1 token which has the value of exactly $ 1 USD. We can call this issued token say, $USDTR.

As you may have observed from the diagram above, the WSTs have a naming convention and they all have a suffix of “TR” after the name of the currency. So, the name of the corresponding WST for $USD becomes $USDTR and $AUD becomes $AUDTR respectively.

$INRT acts as the stabilizer that pegs the value of 50 $USTC to 1 $USDTR and maintains it at exactly $ 1 USD even if the value of $USTC changes after the token has been issued.

The value of the token will remain $ 1 USD after that as well, since it is pegged to $INRT (as an intermediary) rather than being pegged to the value of $USTC after the token has been issued.

Uses of WSTs

  • Can be used by forex traders for arbitrage trading directly since they are all pegged to their respective currencies
  • Can be used as a store of value for governments, institutions and retail users who may choose to invest in the currency of their choice from currencies of 22 different countries
  • Payments to merchants and vendors can be made in local currencies of 22 different countries which is extremely useful for the retail and commercial goods transport and trading industry
  • Can be swapped/exchanged immediately for another WST since they are native to the Terra Luna Classic blockchain
  • Can be used to swap/exchange between the de-pegged currencies or to swap/exchange WSTs for de-pegged currencies

Now that we have a clear understanding of what WSTs are and how we are using them as intermediaries, let’s explore the functionality of the decentralized exchange in brief.

Functionality

  1. Swap/exchange any de-pegged stablecoin for it’s respective WST (explained above). For example, $AUD can be swapped for a Wrapped Stable Token (WST) called $AUDTR

  2. Swap/exchange any de-pegged stablecoin to a different WST currency. For example, $AUD can be swapped for $CADTR

  3. Trade between WST stablecoin pairs. For example, $AUDTR can be swapped for $CADTR and $INRTR can be swapped for $USDTR directly

  4. Useful for arbitrage traders who might require capital infusion immediately using a different coin when they see profitable opportunities in the market

  5. Extremely useful for frequent flyers to foreign destinations since WSTs can be exchanged/swapped for other stable denominations which represent the local currencies of 22 different countries

  6. All de-pegged coins on the Terra Luna Classic blockchain can be traded for $INRT (a stablecoin) which acts as the stabilizer for the entire system pegging each de-pegged currency/denomination to it’s respective WST

  7. Reverse swap/exchange WSTs for de-pegged stablecoins. For example, $AUDTR can be swapped for $INR

  8. $INRT can be traded for only the following 23 currencies which exist on the Terra Luna Classic blockchain currently: uaud, ucad, uchf, ucny, udkk, ueur, ugbp, uhkd, uidr, uinr, ujpy, ukrw, uluna, umnt, umyr, unok, uphp, usdr, usek, usgd, uthb, utwd, uusd

  9. Swap/trade/exchange $INRT on the Cosmos ecosystem. For example,

  10. Buy Luna 2.0/Mars using $INRT

  11. Swap $INJ for $INRT and stake on Injective/Kujira

  12. Trade and cash out $INRT as $BTC or $ETH

  13. $INRT is a gateway to Cosmos for de-pegged stablecoins like $USTC, $INT, etc.

Liquidity Pools

LP1 - Liquidity Pool of De-pegged Coins

This LP represents the current liquidity stuck on Terra Luna Classic which comprises of the de-pegged stablecoins apart from $LUNC. The exchange rate of the de-pegged coins are down by 50-100 times. Taking it out of the system without a repeg would mean losses of 50-100 times for any holder holding these coins and is thus not feasible. The TVL of this LP would decrease over time since the objective is to convert all de-pegged stablecoins to WSTs eventually.

LP2 - Liquidity Pool of $INRT

This is the primary LP of $INRT coins comprising of liquidity provided by users, buyers, investors, validators and other stakeholders of the system. The TVL of this pool changes in value continuously as it is pegged to the value of $BTC and $ETH as described earlier.

LP3 - Liquidity Pool of WSTs

This LP is controlled by traders issuing WSTs in exchange of de-pegged stablecoins on Terra Luna Classic. As more traders stake and issue WSTs, the TVL of this LP increases in value linearly over a period of time.

Advantages of a Community DEX

For Holders:

It provides a route to exit the liquidity loop in which most holders of the de-pegged stablecoins are stuck in; the money can’t be taken out of the system or utilized in any profitable way currently. $LUNC and $USTC are the only two supported currencies for trading in most cex’s and dex’s, out of 23 different currencies.

For Investors:

The community dex is an extremely lucrative platform for investors since they would be able to provide liquidity and get rewards, arbitrage/trade within the system (while having complete control over their money in a non-custodial wallet), stake any Terra Luna Classic currency and get rewarded in stablecoins which can be used directly on Cosmos, or even, for the more adventurous, invest in $LUNC Liquidity Staking Derivatives (LSDs) and cash-out as $BTC+$ETH (more about this in a separate whitepaper on the community dex).

For Validators:

$INRT is only allowed to be validated by Terra Luna Classic validators. This eligibility criterion will be mentioned in a separate whitepaper on $INRT, but it is important to mention this here since all gas fees used for transactions in this community dex will also go to validators of the Terra Luna Classic blockchain, whether it is for $LUNC, $USTC, WSTs or even $INRT (as mentioned earlier).

Pros & Cons

Disadvantages

  • This is a complicated proposal so it will take time to build, issue, test and release a stablecoin pegged to an actual currency - almost 6 months
  • Since I am a solo developer, I will take more time to develop this than I would have taken if I would have worked with an entire L1 Team of 6 people, but I do NOT wish to do so with the current iteration of the L1 development team nor am I willing to overcharge the community by making up non-existent developers
  • I cannot possibly fund this proposal or work without money. It would have been possible had this been a small dapp or even a wallet. But I will need to provide FULL-TIME work to the community (6-8 hours each day - I have currently put approximately 8-10 hours each day to write this proposal) to complete this project within the stipulated 6 months period, and I cannot do this without a guarantee and appropriate remuneration of my employment with the Terra Luna Classic community

Advantages

  • Places Terra Luna Classic on the map of DeFi projects once again by introducing a high-level technical architecture of a trading system in which all currencies on the Terra Luna Classic blockchain, including $LUNC, is being properly used as DeFi coins
  • Burns supply of $LUNC, $USTC and other de-pegged Terra-Luna stablecoins directly by enabling trades/swaps/arbitrages between currencies
  • Introduces a correctly pegged stablecoin to the ecosystem before $USDC becomes the default stablecoin of the Cosmos ecosystem/market
  • Re-enables the market swap functionality without touching any L1 core module code (since it is not required to do so after the introduction of WSTs)
  • Provides us with a Community DEX, transaction/gas fess of which will directly/indirectly go to the validators, delegators (Oracle Pool) and developers (Community Pool)
  • Excess reserves from our Reserve Pool (after balancing the Buffer Reserve Pool) will be completely used to burn $LUNC
  • Multiple macro and micro liquidity pools provide safety, security and much needed capital infusion to the Terra Luna Classic ecosystem
  • Provides a way to enter and exit the Terra Luna Classic DeFi system without the need to use a centralized exchange for trading/swapping/staking: our system would enable traders to deposit in $BTC/$ETH and also withdraw as BTC/$ETH, making it extremely convenient for anyone to invest into the various currencies, WSTs and even a stablecoin on the Terra Luna Classic ecosystem
  • Wrapped Stable Tokens are being introduced to the Terra Luna Classic ecosystem for the first time, probably, on any blockchain, which re-enables arbitrage trading between currencies
  • I AM the developer who is going to develop this entire system with minimal external help. I am directly reachable 24x7 via Agora, Discord, Telegram, Email and if required, on WhatsApp
  • I DO NOT require the help of the L1 Team to do my work and execute this plan end-to-end. I also do not require the help of other developers since I am a Senior Full Stack developer myself
  • I will provide DAILY updates with complete details about work done. If I take a holiday I shall inform the community beforehand about leaves well in advance

… To be Continued in the next comment

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Since the Community DEX Design diagram wasn’t uploaded properly, I am reuploading that again here:

Dex-Diagram

The rest of the proposal which I wasn’t able to post earlier is attached below:


Timeline

It will require approximately 6 Months to develop the complete repeg system which involves developing and issuing a new stablecoin $INRT on the Terra Luna Classic ecosystem and enabling buy/trade/swap functionality for $INRT using only $USTC.

Budget

I require a supply of depegged stablecoins from the Community Pool for my work so that I can use those coins to work on how I can gradually bring them back into the system like $USTC, and enable buying $INRT stablecoins using the other stablecoins which had been depegged in the crash.

For the complete project of 6 months, I would request the community to provide me with the following funding:

For the $USTC Pool - 2,000,000 $USTC (approx. $ 40,000 USD) — will be completely invested to issue and convert into new $INRT coins

For 6 months of L1 and L2 development work - 1,000,000 $USTC (approx. $ 20,000 USD)

Total Investment requested - 3,000,000 $USTC (approx. $ 60,000 USD)

Team

I, Arunaday Basu, am currently the sole developer of this project. If it is required to take additional help for the project, I will take the help on my own salary and the community does not need to pay anything additionally apart from what has been mentioned in the Budget.

You can find an introduction to me here, and here and the following is a brief description of my professional experience along with my social/public profile links:

I am primarily a full-stack JavaScript developer and MERN (MongoDB, Express, React, Node) is the stack that I generally prefer to work on. I have almost 13 years of development experience in various languages, stacks and CMS. I am professionally a business owner and I have a Bachelor of Engineering degree in Computer Science and Technology I have been involved with various startups and I have been employed in a company (MyGlamm) which is a unicorn startup company now. I have also worked on a blockchain project on EOS (MediPedia), as a React developer and then with one of the best advertising agencies in my country (Zero Budget Agency), in various positions, from development to strategic marketing. After that, for the last 3 years, I have been managing my family business of over 26 years in electronics & electricals, miners and other equipment and continuing to work on my own coding projects. I am a resident of India, and apart from coding, I am passionate about trading on the cryptocurrency market, mining, history and art.

You will be able to find my current projects on GitHub and as you will notice, I have already been contributing to the Rebel Station wallet for Terra Luna Classic. You will further notice in my GitHub repo that I am working on a wallet for the new blockchain called Archway.

All that I am sharing with you are either past projects that I have worked on or side projects that I am working on currently.

LINKS TO MY PROFILES:

LinkedIn: https://www.linkedin.com/in/arunaday

GitHub: arunadaybasu (Arunaday Basu) · GitHub

Twitter: https://twitter.com/klothtweets

PROPOSALS ALREADY IN DISCUSSION:

Frequently Asked Questions (FAQs)

Qn: Is this a “$USTC to $1 USD” plan?

Both yes and no.

Since$USTC is a depegged stablecoin, the status of $USTC is currently similar to any other cryptocurrency without reserves.

The disadvantage of this is that it cannot be used in lieu of a dollar, but the advantage is that $USTC is not restricted to the price point of $1 USD anymore: it may exceed $1 in value as well if enough supply is burnt.

  • What I am providing in this plan is a way to burn $USTC and convert it to a stablecoin

This will provide traders and exchanges with arbitrage and trading opportunities in $USTC. They will be able to invest and make money from their investment. They may even choose to margin trade or invest in futures of $USTC. They are not restricted anymore to how a stablecoin functions.

Qn: Is this proposal an alternative or replacement to Redline’s or Duncan’s proposals?

I have mentioned at the end of my proposal that I do not wish to be the only one working on repegging $USTC.

This is not a proposal that intends to replace the other proposals by Duncan and RedlineDrifter.

If they wish to pursue their proposed ideas and/or also work on Do Kwon’s original arbitrage function that is defunct currently, then they are free to do so.

It is not something that I can, or wish to take up, since it is too risky and I would rather go for a $DAI or $SILK type of model in which we create reserves made of a basket of cryptocurrencies.

I will not attempt any complicated algorithms to support the peg cause as it is not required to do so: $BTC and $ETH together are sufficient to hold the peg and create the required reserves.

Qn: Are you planning to work on the Market Swap (AKA Atomic Swaps) core L1 module?

It would be a much better idea for the L1 Joint Force Team (currently represented by LUNCBurnArmy as the project manager) along with a Quant to take up as a part of their work.

Duncan has already suggested a method in which it can be done, and he has published a whitepaper on it too. I would highly recommend the community to refer to that.

I will be introducing a completely novel method of swaps between the depegged currencies: wrapped stable tokens on the Terra Luna Classic ecosystem for trading between pairs.

Wrapped Stable Tokens (WSTs) will enable arbitrage opportunities between different currencies and will attempt to emulate the original design of the Terra-Luna ecosystem in which crypto forex traders could profit from arbitrage trading.

Qn: How are you planning to defend the peg of $INRT during a market crash or during a deflation of reserve value?

  • My target investment for the $INRT token launch (ICO) is $ 10 million USD, not $ 40,000

I require this $ 40,000 in a $USTC Pool to get that $ 10 million from the investors because without a genesis block with the correct token amount, the token itself can’t be launched/verified on the Terra Luna Classic mainnet.

There is no particular reason why I chose this figure of $ 40,000. Anything lesser than that won’t be enough to convince investors to put in their money as well into the coin, which is why I have asked for $ 40,000 from the community, which should be a substantial amount in INR (I shall explain later why this is important) to convince investors.

Initially, the complete $ 10 million will be converted into $BTC+$ETH reserves. It is not required to use the $USTC liquidity pool from retail users (the invested $ 40,000).

During a market crash, we will liquidate the value that we hold in $BTC+$ETH (which would have already made profits and increased in value by then) and fund the $USTC Pool so that the TVL of the $USTC Pool remains constant even during a market crash.

Now the question is what will happen if $BTC + $ETH crash together: I have chosen the combination of $BTC and $ETH specifically because it is highly unlikely that both will crash together. Generally, whales shift money from $BTC to $ETH when they see the value of $BTC falling and vice versa.

Let’s consider that it is does crash and $BTC + $ETH fall to 20% below invested value. The result of this will be that 1 $INRT will go below peg.

There is no issue if it does actually, because we are still holding the same amount of BTC + ETH in our reserves. Say, it takes 1 month to recover from the lowest point of $BTC + $ETH and come back up again to the invested value.

During that time, because of the arbitrage opportunity, there will be more buyers for $INRT. Not less. So, we will make more money, not less.

  • Holding reserves in $BTC and $ETH is much safer than holding reserves in fiat which is subjected to inconsistent tax changes and interest rate hikes which could potentially cause a stablecoin to depeg momentarily

A case study is what happened during the $DAI depeg/crash. It repegged (during a weekend!) because they were still holding their reserves in the exact same denomination.

$BTC and $ETH will stay as $BTC and $ETH in our reserves. Theoretically, only the value is changing for these coins on a daily basis, so when it falls, it goes slightly below peg and when it profits, it goes slightly above peg.

That’s absolutely normal. That’s how most stable coins operate.

How is $DAI backed?

For example, $DAI is held completely in crypto and its value fell/crashed during the $USDC depeg. Nothing happened. Absolutely nothing. Some people didn’t even get to know that it depegged and then repegged again. Both $USDC and $DAI did that in less than 48 hours.

This is because they were still holding the exact same number of coins. It’s just the value of those coins had crashed. That could happen temporarily. That’s not an issue with a large number of investors invested into a stablecoin.

Qn: Why did you choose to peg a stablecoin to the Indian Rupee over the US Dollar/Euro/Yen ?

Although there are many reasons (including the de-dollarization movement which is catching up with the trading industry), the primary reason for choosing the Indian Rupee is that $INRT is a direct competitor to centralized CBDCs which have already been launched in India.

The Rupee is 64% above the current value of $USTC. It is much easier to peg something with +64% margin than say -98% margin (like in the case of $USD ↔️ $USTC).

The Central Bank is targeting 1 million users in 3 months. This is how many people live in India.

  • The entire target base of CBDCs is also the target base of a decentralized alternative to CBDCs

If we are in time for the market, then we will not only be a competitor to CBDCs, but also a strong competitor to fiat-backed stablecoin $USDC which is being introduced into the Cosmos ecosystem.

Qn: If $USTC can’t be pegged to exactly $1, how do we issue our own stablecoin pegged to $1?

That is quite simple actually and the process begins by issuing a stablecoin like $INRT.

Once you have bought/swapped for $ 1 USD worth of $INRT, you can exchange that for $ 1 USD worth of Wrapped $USTC.

Wrapped $USTC can be issued very easily cause we already have a stablecoin.

$ 1 USD = ₹ 82 INR

and

₹ 1 INR = 1 $INRT

So, we can issue a coin called Wrapped $USTC in which,

1 Wrapped $USTC = $ 1 USD = ₹ 82 INR = 82 $INRT

Similarly, we can also issue stable coins for any other country/currency combination in the world, like Wrapped Yen, Wrapped Euro, Wrapped Renminbi and so on.

Qn: This is a $USTC repeg plan. What about $LUNC?

Most $LUNC holders are also $USTC holders. Before the de-peg, traders had access to both currencies and after the de-peg, $USTC was partitioned to the Terra Luna Classic ecosystem because of the possible liabilities associated to the financial losses due to the de-peg.

Thus, a $USTC repeg also means good news for $LUNC since it is a coin which currently belongs to the community owned version of Terra Luna - Terra Luna Classic, and maintained on the same LUNC blockchain, so if $USTC increases in value, then the Total Value Locked in the Terra Luna Classic ecosystem also increases, giving us access to more liquidity, more dApps and more returns from investments.

Qn: Have you checked the rules, regulations and related compliances which are needed to be completed in order to launch a stablecoin?

The Terra Luna Classic community is currently not registered in any jurisdiction in the world (as far as I am aware of), which means that no one person or entity owns the Terra Luna Classic ecosystem/blockchain.

This is a decentralized ecosystem and we are launching a decentralized stable coin on a blockchain-based technology. The objective is to create a trustless payment ecosystem which can be used by everyone regardless of borders, legalities and restrictions. Issuing a stablecoin is central to the idea of such a decentralized ecosystem of currencies which can be used for everyday payments by anyone in the world.

I would not, as a developer, like my technology to be centralized now, or any time in the future. If the community chooses to do so, they may pass a vote after 6 months and decide whether they wish to register the stablecoin of the system ($INRT in this case) legally with the financial authorities of a particular jurisdiction. However, the community may not do so during the first 6 months of development during which time I will be building the stablecoin ecosystem.

Qn: Why are you using $BTC + $ETH to create reserves and not fiat?

This follows from the previous answer since it does not require a KYC or complicated registrations to create reserves in $BTC + $ETH. We do not require a bank account or company documents to own a programmatically controlled transparent account with reserves for any currency that we want.

Recent bank collapses have proven the volatility of fiat reserves and if $USDC had kept their reserves in cryptocurrency, they would not have to face what they are facing today: banks which hold their reserves are closing down and causing $USDC to de-peg multiple times because their reserves are held in fiat in a bank account.

Qn: What will happen if you are not available to work for some reason?

Since this is a project by the Terra Luna Classic community and I represent the LUNC Community, in case of my absence from work for unavoidable circumstances, the community may pass a vote to hand over the work to other developers of the LUNC ecosystem.

I will publish my work to GitHub and make it open source so that other developers may contribute and in case of my absence, the repository may be forked and the work can be continued without my intervention as well.

Qn: What is the investment required after 6 months?

Nothing. The investment that the community is making currently for this proposal is a one-time investment and it is my responsibility to bring capital investment into $USTC, $INRT and the other stablecoins on the Terra Luna Classic ecosystem.

Apart from development being a primary job during the next 6 months of engagement with the community, I shall also engage in investment/funding opportunities and a major token launch which should not only be sufficient to see me through after 6 months, it should also be sufficient to re-distribute this investment back to the community as rewards in the near future.

Notes

The community has, till now, invested close to $ 300,000 USD on L1 & L2 development and is about to invest close to $ 40,000 more on L2 development. Next quarter, the community will need to invest close to $ 120,000 USD more to fund the L1 Team which continues to struggle at it’s work for almost ONE ENTIRE YEAR now. The results we have to show for $ 300,000 USD investment till now, are shameful, to say the least. I will go as far as to say that it was a direct breach of community trust with money that was taken from the Community Pool.

There is absolutely NO ONE and NOTHING that is working on developing a solution which re-funds the Oracle and Community Pool(s) of Terra Luna Classic directly. This repeg plan might be the ONLY way to re-fund the Community Pool considering that other developers are not even bothered about the near-empty Community Pool from which they are withdrawing their salaries. I do not think they understand that there is no more money for Quarter 3 of L1 development work after Rebel Station is funded. Other considerate members of the community have forcefully passed proposals to reduce the funding of the Community Pool. A complete disaster is about to take place in less than 6 months if we do not fund a plan, with the little money we have remaining, that directly sends money to the Oracle and Community Pool(s).

This proposal is a culmination of many ideas from the number of discussions I have read on this particular topic of a possible $USTC Repeg (including Ziggy), but the reason I am proposing this is because I will be the primary developer and project manager handling this entire plan. I will not be working with the L1 Development for this work since it is not required to do so according to the plan. Also, L1 Development is slow, so I do not wish to depend upon their development to achieve goals of the community.

Having said that, I understand that Duncan’s proposal (Ziggy) is in discussion and I have recommend him to work with the L1 Team. I have kept that in mind and this proposal does not interfere with his proposed $USTC Repeg plan since I will not require L1 Development to be done for my plan, so both plans can work independent of each other and yet try to achieve the same goal of $USTC Repeg.

This plan also does not compete against Redline Drifter’s $USTC Repeg plan which implements a Divergence Tax fee, which has passed governance at the time of writing this document. Even if the divergence tax is implemented, $USTC would still be useful for trading $INRT and thus, other wrapped stable tokens in the system. Redline’s proposal will, in fact, act like an additional safety measure above and over this plan’s buffer and reserve system to protect $INRT investments.

Addendum to Notes

Although this proposal began primarily as a $USTC Repeg Plan, it has now developed into what I can safely call a Terra Luna Classic Technical Recovery Plan using a methodological high-level technical design and architecture which makes the blockchain useful again for payments, arbitrage/trading opportunities as well as for long-term holders of $LUNC who wish to see their holdings profit from reducing the supply substantially over the next 1-2 years and not 87 years (as calculated using the current burn rate which has reduced further after this calculation was done).

I took some time to not only expand this proposal further, but also went and checked whether implementing the ideas described in this proposal are possible to be implemented technically or not. I created a test coin on the Cosmos testnet, transferred it between wallets, created CW20 wrapped tokens on Terra Luna Classic and transferred them between wallets. I can safely conclude that executing this proposal is possible, though the time required to complete the community dex along with the rest of the plan would extend the timeline by 2-3 months. This is unavoidable and I wish to devote more time into security and safety checks on the dex before it is made public. The community dex might be one of the most important components of this plan and coding it properly by taking more time will only benefit the community.

Thanks for reading this till the end.

DECLARATION

If this proposal is passed by the community, I will provide the community with a Stamp Paper issued by the local Sessions Court in my local jurisdiction in which it shall be notarized/attested by a Magistrate/Corporator that my employment with the Terra Luna Classic community shall last for 6 months during which time I shall be employed full-time with the community, and that the community has the right to terminate my employment with the community at any time by passing a vote in governance. This document shall be made available to ALL members of the community.

DISCLAIMER

No part of this document should be used as financial advice and cryptocurrency investments are subject to market risks.

2 Likes
3

Let me put in perspective for you.
Your initial ico would be less than 5 million tokens.
Total worth of the tokens=60 000 USD.

Now that is what you are building a comeback for 9.8 billion?

5

If you start it with nothing, have to get it listed somewhere and then convince anyone to actually trade it to start producing.

You do realize how this proposition, currently or in similar conditions, makes so little sense that it’s pretty much the same as not trying at all.

7

I wish to explain this point a little bit more since I understand your dilemma.

This is what I wrote in the beginning of the proposal.

And I understand the confusion. Since I said that this is the initial supply and then I said that I will get investment for 10 million.

Both are true.

The intial supply is what the community is paying for, to issue the coin on the chain. Once this supply is issued, we can test the coin on the chain and check how it is working and approach investors with the product.

Since more coins can be minted when we have 1:1 reserves held in BTC+ETH, I will first take 10 million from the investors (at least 1 million) and then issue more coins in an ICO (in which current LUNC holders will be able to participate as well) and then will the coins be released for public use on the dex.

So, it’s all happening. Just over a period of time. Not together. First this 40k has to be issued as coins, then testnet, then investment, then issue some more coins, then mainnet and then official launch.

P.S. I apologise if I sounded condescending before this. That was not my intention.

8

Hi Tonu, your knowledge seems to know no bounds, it’s great to see someone separating the crap from the facts.
I do wonder though why you haven’t used your immense talent creating proposals to the benefit of Lunc.

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9

So you find no fault in the arguments themselves, thus you come at me?

10

Haha good one. It’s fine. I appreciate all kinds of questions on this subject.

I am aware that the topic is highly technical and it will take some time for everyone to read and absorb it completely, and the community will have qns that I am ready to answer till the time that everyone understands every bit of the plan completely.

@Tonu_Magi appreciate your qns and keep 'em coming!

I wanted to mention here that I have done the research thoroughly for this plan and I have taken the time to do so.

Since I have read all the plans which have been posted to Agora till now in the last almost one year, I can assure you that this is the most detailed one from the perspective of sound technical design.

I have researched what DK had designed, I am a trader myself and I know what arbitrage trading is. This entire Terra Luna Classic ecosystem was designed to do arbitrage trading. I have captured the essence of that original idea of this blockchain in my plan without retaining the security issues that the original design had.

One the primary issues with his original design was the minting and burning. He used to mint Luna for Terra and Terra for Luna. Like the Earth (Terra) and the Moon (Luna) it used to keep the peg alive, like the gravitational forces between the two heavenly bodies keeps us alive on Earth.

Life on Terra cannot exist without Luna

Technically speaking now, you must be wondering how am I gonna issue new tokens if the minting function of $INRT is disabled.

I just realised that’s what you were trying to ask me. Well, on Cosmos it’s quite simple actually.

During the initialisation of a blockchain on Cosmos, we need to write a configuration file called “genesis.json.”

Now, what a fork is, technically speaking, is basically taking this genesis.json file, editing it, and then re-initializing it again using the same admin account which created this genesis.json file and initialised it for the first time. Then it stays the same blockchain, just with extra code. Otherwise it becomes a separate fork.

What you have to do additionally when you are forking (or migrating) a blockchain like this is that you need to take a snapshot of all the account addresses and the account balances. You need to write that into this genesis.json file before re-initializing it again.

This is how Terra Luna Classic was forked and re-created with the accounts from the snapshot. This is reason that file is 1.3GB right now. I checked it a few days back as well.

So, the same will be done with $INRT as well. We will initialise it for the first time with approximately $40,000 (what I am requesting for currently from the CP) and then we will re-initialize it again using $1-10 million (which is my target investment for $INRT).

I hope this makes this concept easier to understand.

1 Like
11

You still don’t see the maths?
You make 40 000 and from that you are going to grow a measly 1-10m?

And what is the projected century for even 500k in reserves to be?

12

$40,000 USD makes approximately 5 million $INRT tokens.

That’s enough for a pre-mainnet launch.

I know what I am saying since this is my country’s currency. I know how much is 5 million $INRT = ₹ 50 lakhs.

We have a different currency system also and 50 lakhs is half a crore, which is a lot of money in Indian Rupees where I need the investment from.

I do not need the investment from Americans currently since this is a coin pegged to the Indian Rupee.

By logic, there will be more investors in India for a coin pegged to the Indian Rupee (when there is a CBDC being launched called e-rupee) than in the US, that I would need to worry about how much is 40k in USD.

I also do not need to worry about the investment since I know the biggest investors and industrialists in India are already using CBDCs from December. They already know what a stablecoin is. I just need to give them that on a platter. A decentralised platter in this case.

2 Likes
13

Rajia Bibi explains my point further. She is a real human being who CZ replied to. So she is known in the community. She added me on LinkedIn as well. You can go and talk to her and understand the exchange rate better if you want.

Screenshot_2023-05-01-23-47-27-139_com.twitter.android
Screenshot_2023-05-01-23-47-27-139_com.twitter.android1080×2400 135 KB

I assure you I know what I am saying, and $40,000 USD in INR is sufficient to make a factory :factory: here if you want, not just a simple blockchain or cryptocurrency.

That’s an average engineer’s salary for 4 YEARS in India, to give you perspective.

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14

The debt you are looking to recover is in dollars.
Indian pecularities do not change that and you didn’t answer my question - do you have any ETA or modelled numbers.

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15

I actually have an answer to this question but before that, did you guys ask Redline the same question on his proposal? If you did, then you would have already got an answer to this question from him.

I didn’t see anyone ask this question on his thread though, and yet the proposal passed. So why is this question being asked to me exactly?

This also indicates that post-c(rash holders are not aware about this and pre-cr(ash holders are probably de(ad or I dunno what happened to them. They are not talking to me at least, even though our $USTC repeg plans are up for approximately 1 month by now if I consider Duncan’s, RedLine’s and my plan.

I did hear Z say that someone had contacted him and I guess Duncan had said some people had contacted him.

No one has contacted me till now. If they are alive, and they want their money back then they need to show up publicly and ask for it. Even if not publicly, they need to msg me privately and reach out to me. If at least 10 genuine vic(tims of the cr)ash did that, then I will come back here and tell you guys what the plan is with servicing the debt.

P.S. If you think about it, Redline is the one who is repegging $USTC. I am making a NEW stablecoin. So you should be asking this question to him, not me.

Though I am not the kind who shrugs off responsibility so I am ready with an answer for this if at least 10 people from pre-cr(ash times tell me that they want this money back.

16

That’s not what I asked you, you didn’t answer my question.

17

Did it even deserve an answer?
Proposal writing is a menial task. Actually having an idea, seeing it through and making sure it matters is quite a bit more involved than asking basic questions to which the proposal author does not have any.

Basic income projections get answers how 40k is huge sum of money in India.
Take from that what you will. Perhaps you also have a proposal that needs auditing?

1 Like
18

does lunc use cosmos and columbus-5 block ? mir and wormhole?

19

If you are asking about how much this proposal makes in dollars, you are missing the point of the proposal and asking the wrong questions.

The question isn’t how much money this proposal is gonna make. This isn’t a vending machine.

The question is whether this proposal is capable of bringing back liquidity to $LUNC, the answer to which I think is absolutely Yes.

You can do all the maintenance work on the chain you want for the next 10 years and still $LUNC will remain below 0.00016 cause you don’t know why people invest money into a blockchain. If you search this forum you will see that I had said the exact same thing 4 months back, and you and I both know what is the value of $LUNC right now. I dunno whether you know the price but I trade in it, so I definitely know.

Retail users like you cannot take this chain to $50 billion. It requires a completely different perspective and a much larger vision than what we currently have of the cryto/stablecoin market. That roadmap that TR had made looks like a 3 year old made that.

Till now we have WASTED $ 340,000 USD to do ABSOLUTELY NOTHING.

And you can keep doing this forever and still it will yield absolutely NOTHING.

This is the point of time that you decide whether you wanna vote Yes on this proposal and keep $LUNC the DeFi coin that it originally was, or you wanna vote No on it and make it the next meme coin saga at Rank 100.

20

Need capital, reserves for USTC.

  1. Start MMM (Market Marker Module) with upper limit.
  2. Find VC.

Omg. This Terra 3.0.

21

I have posted the proposal for a vote here (Proposal No. 11501):

P.S. Over the next 7 days I will be posting daily updates to this proposal discussion from my Twitter account and also on Agora.

I will be breaking down and explaining each section of the proposal apart from what has already been painstakingly described in proposal already.

I would request everyone to go through the proposal in details. Please encourage your validators to vote, or exercise your voting rights yourself.

Thanks.

22

All 3 are there in this plan.

Well, I didn’t make Terra 1.0. So I can’t be making Terra 3.0. I don’t really know how that is made.

I have read DK’s work but I do not find it impressive honestly, which is why this plans changes the security model completely and shifts it to a reserves based model.