Pre-attack UST holders will probably be compensated!
This is going to be a really short post as I only wanted to share a piece of good news for UST holders (pre-attack). As we all know both LUNA and its "algorithmic" stablecoin crashed in the past few days in an epic "attack" that ended up with LUNA being as low as $0.000001 and UST being as low as S0.05. In response, the CEO of Terra, Do Kwon, and his team proposed a fork on LUNA blockchain that will be airdropped as follows:
- Community pool: 30%
- Pre-attack LUNA holders: 35%
- Pre-attack aUST holders: 10%
- Post-attack LUNA holders: 10%
- Post-attack UST holders: 15%
However, UST pre-attack holders were not satisfied with the above distribution and they requested compensation for their UST coins with either USDC or USDT.
A developer in the Terra community called "Fatman" actually posted a proposal explaining a "realistic" procedure to compensate UST holders from LFG's reserves (a non-profit foundation that is meant to protect the peg of UST) with priority for small wallets...
Over the past few days, Fatman's suggestion was very much ignored by the Terra team though it was the most popular one. However, a ray of hope appears to be emerging...
The good news is that Do Kwon (the CEO of Terra) tweeted that the team is collecting data from exchanges to determine UST holders before the "de-deg" event and then pay them with either USDT or USDC. This means some kind of compensation is already in the works!
Why not LUNA holders?
The reasoning is that LUNA is a risky asset that can go up and down just like every other cryptocurrency on the market while UST was meant to be a stablecoin with zero risk involved...That's Why Terra has an obligation to refund all UST holders. Well, it seems a bit unfair, but we should also remember that LFG's reserve is quite limited and is hardly sufficient to compensate UST holders alone.
To be honest, I'm not a fan of Do Kwon's proposal to fork LUNA nor am I a fan of his plan to ignore "post-attack" holders as if they were guilty of buying LUNA/UST at the dip. It does feel like a "punishment" for all those who tried to believe in the project that it could recover soon, but again, we can't put the entire blame on the Terra team, maybe those unknown parties who attacked UST in the first place and caused it to lose its peg deserve the lion's share of the blame too...
What do guys think about Do Kwon's proposal?
I'm keen to read your opinions and thoughts...
PS, Unless otherwise stated, all images in this post are either my own design or from free photo-sharing sites (e.g. pixabay.com)
Hello @qsyal, I am quite surprised by this news, it is really the first time that I read about a possible compensation after the failure of a project of this nature, and in this case there should be some equity when choosing those who are going to compensate, some will not agree According to leaving a group of users without compensation, it would look very strange.
I totally agree. However, Terra's reserve has been massively drained trying to defend the peg, and it seems hardly sufficient to compensate pre-attack holders
Thanks for reading :)
Hi @qsyal
I would really like to see that Luna holders can be rewarded, what happened with Terra Luna will remain with one of the worst and episodes of the cryptocurrency market, and even that the most damage to date has caused to the health of cryptocurrencies.
Best regards, be well.
@tipu curate
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Hi @qsyal
There are really many people who are affected by the LUNA situation, the fact that they can compensate the UST holders, this would help improve the confidence of users in the fork of the project, thereby having the possibility of saving users who lost a lot of resources.