USTC re-pegging and LUNC burning

Hi, Lunatics!

Is there any way to re-peg USTC and reduce the amounts of the LUNC somehow?

I want to know realistic way or logic to go back to the system of the LUNC and USTC before.

Are the algorithm or codes still alive between LUNC and USTC though, right?

Please share the wisdom.

Thank you

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The algorithm was disabled and they said they might used fiat to back the stable coin rather that algorithmic pegging.

Why is Luna still listed on Binance and Coinbase if what happened was negligence? If I were you I would hold my position because Binance they have high ethical standards and they will not let customers be abused.

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I keep hearing this but I haven’t seen any official statement on it. Got any link for the algorithm being disabled?

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There are actually multiple ways to achieve that. The crucial thing is to allow converting from USTC to LUNC, but limit minting of LUNC at the same time.

For example, there can be a limit like “not more LUNC can be minted than has been burned in the last 24h”, meaning only if LUNC has been burned, it can be minted again.
Another option is to set a hard limit for the amount of LUNC tokens, like 6.9T. When the burning is in process, USTC can be converted to LUNC but never past that threshold. That way, the USTC re-peg can slowly take place. After that, the amount of LUNC tokens can fall.

I personally think both options are good because it is important to re-enable arbitrage trading between LUNC and USTC. That way, more trade volume is created, resulting in more taxes, resulting in faster burns, etc.

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You can’t limit the LUNC issuance in any circumstance.

All you can do is rebuild the BTC reserve, but programmatically buy X% per X% drop in the USTC peg.

LUNC is a recapitalization engine for the protocol. LUNC hyperinflated to zero because the bad debt of the system (market value of USTC) dwarfed the market value of LUNC. That meant that for every incremental LUNC issued/USTC burned (= retirement of bad debt), the LUNC market cap was dropping faster. Which meant that in the absence of a bailout, LUNC was headed to zero.

Now, those ratios have shifted dramatically. There’s around $80M of USTC market cap vs $400M of LUNC. USTC needs to be burned until the amount of USTC in circulation equals the market cap of USTC, ie, there’s only 80M USTC left and all the rest has been converted to LUNC at the prevailing rate.

It would mean issuance of another US$80M worth of LUNC at most, or 20% dilution to current LUNC holders.

Is it possible to have dual USD re-peg functionality for USTC stablecoin via collateralization and algorithm; where the former keeps USTC from dropping below the dollar mark while the later keeps USTC from rising above the dollar mark.

We can re-pegg USTC to the reserve value as today market price.

Once inflow fund come, it could process LUNC burn. At the moment 1$ USTC can burn 10000 LUNC.

LUNC supply will lower and market price will grow so next inflow could bring to burn less number of LUNC.

But inflow will not come if rack of profits in front.

The USTC algorithm must allow to create reserve growth. That has gap to higher Pegg price level.

The algorithm must not mint LUNC to fright the attract but to maintenances reserve value. This is will wipe USTC down side risk.

Chaiya

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Not use reserve to flight attack but use whale deposits to flight it.

As long as reserve still cover total USTC, no body could bring it down. If it de-pegg again re-pegg it with re-pegg method. May using pumping or curve depend of reserve value.

they see it wrong. if you have followed the history of binance coins you will see that your statement is not true. let’s go back to 2021 coin .

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Seems like DK selling 1.85b ustc from LFG, stong sale.

According to this, there is no sale. Do you have any links?

请查看这篇帖子:A proposal to generate a new stablecoin stUstc by pledging Ustc