In a Monday update, leading exchange Binance revealed that it had burned $1.8M worth of Terra Classic token trading fees. The move came as a response to a community proposal from September and aimed at shedding some of the token supply.
Binance Completes the First Burn
CEO Changpeng Zhao informed users that the company had completed the first LUNC burn via a post on Twitter. The exchange had sent about 5.5 million LUNC tokens worth 1,863,213.47 Tether (USDT) to the burn address. Binance earlier decided to complete the burns every Monday, as this was the first the next is set for Monday, Oct 10.
Binance originally shared plans to implement a burn mechanism about a week ago. The platform stated that it intended to burn all trading fees on LUNC spot and margin trading pairs. Essentially, Binance would calculate the total fees for either service and send the funds to the LUNC burn address.
Binance will implement a burn mechanism to burn all trading fees on LUNC spot and margin trading pairs by sending them to the LUNC burn address,” the announcement stated.
The newly burned tokens represent the trading fees the platform processed between Sept 21 and Oct 1.
Users Hope to See LUNC Recover
A Twitter user dubbed “LunaBurnTracker” had been keeping tabs on the burn plans. In a tweet earlier today, they confirmed that Binance had indeed sent the tokens to the LUNC burn wallet. The LUNC DAO also verified news of the event, noting that it was a “low volume” compared to the past couple of months.
The Terra community suggested the burn as a way to get the token back on its feet. After the memorable Terra ecosystem collapse in May, Terra Classic saw its value fall to nearly zero. The token surged over 250% in September and users hope that as they reduce the supply LUNC will make a comeback.
A Divided Terra Community
However, following the first burn, the digital currency seems to have made little progress. According to data from Coinmarketcap, the token’s value has slipped roughly 10% in the last 24 hours. Going by Twitter exchanges, the Terra community is divided on the burn strategy.
While the majority are confident that the burn will aid the LUNC token, others believe it is too time-consuming. The total supply of LUNC tokens is currently around 7 trillion, and the goal is to bring it down to 10B. However, one Twitter user believes this will take up to 15 years at the present rate of progress.
“With that money, you could hire a dev team to build a suite of useful products/tools instead,” a bewildered tweet read.
At the behest of the “LUNC army”, Binance just threw $1.8 million dollars into the burn address. This will have a 0.09% impact on supply reduction.
Just think of how absurd this is. With that money, you could hire a dev team to build a suite of useful products/tools instead… https://t.co/3wnrzbdGum
— FatMan (@FatManTerra) October 3, 2022