Terra community rejects plan for hard fork and airdrop of a new token

The majority of Terra’s community did not back the idea of a network hard fork. This follows from the data of the preliminary vote on the Research and Governance discussion forum.

The published proposal by Terraform Labs CEO Do Kwon envisions launching a new blockchain and an airdrop of a token. The second version of the network will keep the Terra name and its token—LUNA. The original blockchain will become Terra Classic with Luna Classic (LUNC), respectively.

Kwon said the team regards this as ‘a viable path to revive the Terra ecosystem’.

At the time of writing, 90% of the 1,765 poll participants did not back a hard fork. Anyone willing to vote may do so, regardless of holdings of LUNA governance tokens.

Official voting on the submitted proposal is set for May 18.

Prices of the algorithmic stablecoin TerraUSD (UST) and the LUNA token began to fall on May 10. This occurred amid an outflow of assets from the Anchor protocol as the yield on deposits fell to 17.87%. As a result, on May 8 the ‘stablecoin’ briefly lost its peg to the dollar.

At the time of writing, LUNA trades at about $0.00018, and the stablecoin at around $0.09 (CoinGecko). The prices did not react to the hard fork proposal, remaining near the lows reached after the Luna Foundation Guard’s report on reserves. The foundation said that in the unsuccessful rescue of assets spent almost the entire fund worth more than $3 billion.

Kwon had already floated plans to resolve the situation around the collapsing project. Some Twitter commentators reacted negatively to the idea of launching a new network. One of them, with more than 157,000 followers, wrote:

“Nobody wants you here, just go. Some people nearly took their own lives because of UST. I have only one question: how can you come back here? You will go down in history as a greedy person with no moral values.”

Nobody wants you here, just go.

There are people who almost took their lives because of UST, my question is how you have the nerve to come back here.

You will go down in history as a greedy person with no values.

— Inmortal (@inmortalcrypto) May 16, 2022

Another user reminded of Binance CEO Changpeng Zhao’s idea to restore the UST peg by burning tokens to absorb excess supply.

why don’t you use cz solution?https://t.co/dAEtpwft71

— Lolipop (@Lolipoplob) May 17, 2022

Many participants in the preliminary voting also urged creating deflationary pressure.

Earlier Zhao said that the Terra hard fork will not work, because the new network would have no value.