Terra Adds an Amendment to Do Kwon’s Revival Plan, Survey Reveals UST Losses
The team behind the Terra (LUNA) blockchain has added three revisions to the already published “revival plan” by co-founder Do Kwon – increasing genesis liquidity and decreasing distribution to certain terraUSD (UST) holders.
Following the infamous UST stablecoin depeg and a wave of subsequent debate and controversy, Terra has published what they call “an amendment to Proposal 1623” in which they said they incorporated the community feedback.
The three revisions are outlined as follows:
1. Increasing genesis liquidity
- For pre-attack UST holders, post-attack LUNA holders, and post-attack UST holders, the initial liquidity parameters have been modified from 15% to 30% to increase token supply at launch and mitigate future inflationary pressures.
2. Introducing a new liquidity profile for pre-attack LUNA holders
- Wallets with LUNA < 10,000 will have the same genesis liquidity as the above-mentioned groups – that is, 30% unlocked at launch – and will have the remaining 70% vested over two years with a 6-month cliff. This is to ensure that small LUNA holders have similar initial liquidity profiles, per the proposal.
3. Decreasing distribution to post-attack UST holders
- The allocation for post-attack UST holders has decreased from 20% to 15% to ensure the depeg-related allocation is on par with the original stakeholder (pre-attack LUNA) allocation. The other 5% will be allocated to the community pool.
“The proposal body has also been edited to reflect the changes in the amendment. If you’ve already voted and disagree with the changes, please vote “No” – you have 5 more days to do so,” states the amendment.
At the time of writing, 49% of Terra validators voted, with 80% supporting the initial proposal, while 15% said no and the absolute majority of them have the veto power. However, the veto threshold is 33.40%.
Quite a few people in the community were not happy with one or more aspects of this decision.
What the hell? How can you make significant amendments to a proposal *mid-vote* when most people have already voted (for the original document)? A new proposal in Terra Station should be made with a fresh vote. This is not cool. (No comment on the changes – just the execution.) https://t.co/SeFpc78Sab— FatMan (@FatManTerra) May 20, 2022
Meanwhile, the Terra Research Forum’s pseudonymous FatMan, provided more details about the collapse of Anchor Protocol that “took people’s life savings with it.” Anchor lending protocol housed the majority of UST’s circulating supply, and it was used as a key incentive mechanism for users to hold UST with its high yields of 20%.
FatMan states that, based on the data collected from 703 people who said they lost money on UST, the lowest verified claim is USD 11.5, the highest from a single person is over USD 5.5m. The median claim per person is USD 23,438, and the average claim is USD 94,869.
Furthermore, “a beautifully diverse range of people from 56 countries in various continents have filed claims,” the majority being from the USA.
FatMan found that,
- “62.9% of people are holding all of their UST and have lost about 92% of their money.
- 23.9% of people panic sold all of their UST at a lower level to salvage some money.
- 13.2% of people sold a portion of their UST.”
The average UST sell basis is USD 0.31, and the median is USD 0.25, which “seems to corroborate the theory that retail customers sold fairly low and whales/VCs got to exit higher,” said FatMan.
At 9:50 UTC, LUNA is trading at USD 0.00013897, up 1% in a day, down nearly 89% in a week, and almost 100% in a month. At the same time, UST’s price is USD 0.073859 – far from the USD 1 peg.
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– Do Kwon’s New Terra Revival Plan Fights for Support as Trust Challenge Remains
– South Korean Government, Prosecution Turn up the Heat on Do Kwon and Terraform
– South Korean LUNA Buying Skyrockets, Token Trading at Huge Premium on Domestic Exchanges
– From Silence to Humbling Hell – Major Terra Backers Keep Low Profile as the Small Guy Is ‘the Biggest Loser’
– A Curious Coincidence – Major Terra Backers Break Silence on Same Day