Several governance proposals and a staking service on Terra Classic have caused the price to skyrocket in the last few hours.
Several months after the Terra and UST debacle, which caused the price of the LUNA token to plummet to almost zero, the price of LUNC, the token of the Terra Classic blockchain, has shot up almost 100% since last September 2nd, due to several governance proposals put forward by the community, which could improve the performance of the blockchain.
Terra Classic is the name given to the Terra blockchain, after the fork which took place at the end of May, following the collapse of the entire ecosystem in May. Although at first, the community was skeptical of the project, in recent weeks the sentiment of investors has changed, causing a slight recovery in token price.
Although it has lost some traction over the past few hours, the price of LUNC touched the $0,60 level, a up 259% in the last 30 days.
Why has Terra Classic risen?
The first boost to the price of LUNC came thanks to the announcement of a New staking service on Terra Classic, which rewards users with an annual return of 37,8%, according to data from StakingRewards.
According to LUNC Staking data, 610.000 billion LUNC have been staked on this service since August 27, meaning that about 9% of the total supply of the token is now out of circulation.
On the other hand, the developers have presented a governance proposal to introduce a token burning system to increase the scarcity of LUNC. To do this, a 1,2% tax on all LUNC transactions which would end in a “dead address,” permanently removing the offer from the network.
The proposal of the burning mechanism is curious, since the blockchainn already has a burning mechanism, which has eliminated 3.600 billion LUNC tokens since the fork went live.
A new LUNA airdrop for holders
Another reason for the rise of LUNC has been the approval of a proposal that rewards holders with More free Terra (LUNA) tokens, the blockchain emerged from the bifurcation of May.
The proposal will result in more than 100 million being distributed. 19 million LUNA tokens to all those users who did not receive an adequate allocation at the end of May, when it was launched Terra 2.0.
Eligible users will be able to participate in the airdrop and will have one month, from September 4, 2022 to October 4, 2022, to claim their airdrop. Unclaimed tokens will be transferred to the Community Fund, including unused gas fees.
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