Terra Community Has Voted In Favor To Burn 1.3 Billion UST Tokens
The Terra community has voted in favor of a proposal to burn all TerraUSD (UST) tokens held in the project’s community pool and UST deployed for past liquidity incentives on Ethereum.
The total count of tokens to be burned totals 1.3 billion UST, representing approximately 11% of the existing 11.2 billion UST supply.
The proposal was approved with 99.3% of the total cast votes in favor of it. After the vote, Terraform Labs – the project’s core development firm – will start to execute the burn.
The process will happen in two phases. The first, will send about 1 billion UST from Terra’s community pool to a burn module where it will be permanently removed from the supply. The second, the team will manually bridge back 370 million UST to Terra from the Ethereum blockchain and burn them, as detailed in the Terra governance forum.
Earlier this month, Terra’s dollar-pegged algorithmic stablecoin UST collapsed from $1 to $0.04 cents before slightly recovering to $0.06 at the time of writing. This represents a 93% drop from its value prior to the fall from dollar peg.
The approval of the UST burn happened just a day after Terra’s governance system approved Terraform’s revival plan to re-launch the Terra blockchain and create LUNA 2.0 tokens.
The new chain will go live Friday and subsequently airdrop the new LUNA 2.0 tokens to holders of Terra-based assets. The new Terra blockchain will exist without the UST tokens, and their use will be restricted to the old Terra blockchain.
