Terra Classic Community Member Proposes Alternative Solution for USTC Stability
A member of the Terra Classic community, known as Rexyz, has expressed disagreement with the idea of burning USTC tokens to restore the stablecoin’s dollar peg. Instead, Rexyz suggests an alternative solution that could potentially revalue USTC to $1 and drive up the price of Terra Classic (LUNC).
Since the collapse of the Terra ecosystem in 2022, the USTC stablecoin has struggled to maintain its value and currently trades at nearly 98.8% below $1.
In response to this situation, various proposals have been put forward by members of the Terra Classic community, with burning more USTC tokens being one of the proposed deflationary mechanisms to help the stablecoin regain its dollar peg.
Currently, the community is voting on a proposal that seeks to have Binance burn 50% of USTC every month. It is believed that reducing the circulating supply of USTC through such actions could significantly contribute to the token’s rise to $1.
An Alternative Approach: Reverse Splitting USTC
Rexyz argues that burning large amounts of USTC may not be an efficient method for restoring the stablecoin’s value. With 9.8 billion USTC tokens currently in circulation, a substantial amount would need to be burned to make a significant impact.
Instead, Rexyz proposes implementing a reverse split of USTC and encourages the Terra community to invest in LUNC as a means of recovering losses. LUNC has also experienced a significant decline in market value during 2022.
It is important to note that Rexyz advises conducting thorough research and seeking approval from relevant experts before executing this initiative.
Hot Take: Exploring Alternative Solutions for USTC Stability
The Terra Classic community member, Rexyz, presents an alternative perspective on the issue of USTC stability. While burning tokens has been a popular proposal, Rexyz suggests that a reverse split of USTC and investing in LUNC could be more effective in recovering losses and restoring value. This alternative approach challenges the prevailing narrative and encourages the community to consider different options. As discussions continue within the Terra Classic ecosystem, it remains to be seen which proposal gains traction and leads to a resolution for USTC’s dollar peg.
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