Failed cryptocurrency Terra launches Luna 2.0: What you need to know
Terra Luna's market value was down to USD 1.3 billion from nearly USD 19 billion earlier this year. But, people kept investing in it in the hope of a comeback. The currency completely crashed earlier this month, wiping off billions of dollars of investor money.
Now, Terra founder Do Kwon's proposal of replacing the current Terra network with a new blockchain, Luna 2.0, has got the approval, and it will be launched today (May 27).
The Terra Ecosystem Revival Plan is deemed to be a new approach altogether, especially the abandoning of stable coin TerraUSD or UST. That means they are creating a new Terra chain without the algorithmic stable coin, reported the Mint.
1/ Terra 2.0 is coming.
— Terra ? Powered by LUNA ? (@terra_money) May 25, 2022
With overwhelming support, the Terra ecosystem has voted to pass Proposal 1623, calling for the genesis of a new blockchain and the preservation of our community.
We take a look at what Luna 2.0 will be like and how it will be distributed.
HOW WILL IT WORK?
Do Kwon will be using the ‘hard fork’ technique to revive the Terra ecosystem. A hard fork is a radical change to a network's protocol that makes previously invalid blocks and transactions valid, or vice-versa. Right now, the Luna supply is over 6 trillion, which is way more than that of Terra at just 1 billion.
The old network Terra Classic blockchain would continue to operate and host Terra USD, but the projects built on the old blockchain will migrate to the new blockchain, reported Business Today.
Luna 2.0 would be the sole cryptocurrency usable by applications and projects utilising the new blockchain.
HOW WILL THE TOKENS BE ALLOCATED?
Terra investors would receive a set number of Terra Luna tokens.
Luna will be air-dropped across its Luna Classic stakers, Luna Classic holders, residual UST holders, and essential app developers of Terra Classic.
- Luna holders will receive about 35 per cent of all new tokens,
- 10 per cent will go to those who held UST before the collapse of the cryptocurrency,
- 25 per cent will go to traders who still own Luna and UST after the crash, and
- 30 per cent will go to a pool of Luna investors.
Terra will become a completely community-owned chain, the Terra network said on Twitter.
SUPPORT FROM CRYPTO EXCHANGES
Many leading crypto exchanges have said that they are going to support the launch of Luna 2.0 on their platform.
#Huobi supports the launch of #LUNA 2.0 on May 27
— Huobi (@HuobiGlobal) May 25, 2022
Are you ready for 'LUNA Rebirth'?? https://t.co/Vn1FFwlc4y
The largest cryptocurrency exchange by trading volumes, Binance, has said that it will support the digital coin. 'Terra Network airdrop to be distributed on Binance. The new Terra 2.0 token $LUNA will be distributed to eligible users based on the project's distribution plan,' Binance said in a tweet.
Terra Network airdrop to be distributed on #Binance.
— Binance (@binance) May 26, 2022
The new Terra 2.0 token $LUNA will be distributed to eligible users based on the project's distribution plan.
The distribution ratio per account will be announced separately.
Find out more ⤵️https://t.co/F7UAbqedxS
Crypto exchanges like Huobi, FTX, Biture, KuCoin and Upbit have also extended their support to Luna 2.0.
NOT EVERYONE BELIEVES IT WILL WORK
Even though the Terra ecosystem is hoping it will revive the crypto currency with a new blockchain, many still believe it's a bad idea and is not going to work.
Binance CEO Changpeng Zhao said this won't work.
'Forking does not give the new fork any value. That's wishful thinking. One cannot void all transactions after an old snapshot, both on-chain and off-chain,' he wrote on Twitter.
Personal opinion. NFA.
— CZ ? Binance (@cz_binance) May 14, 2022
This won't work.
- forking does not give the new fork any value. That's wishful thinking.
- one cannot void all transactions after an old snapshot, both on-chain and off-chain (exchanges).
Where is all the BTC that was supposed to be used as reserves? https://t.co/9pvLOTlCYf
Cryptocurrency Dogecoin's co-founder Billy Markus Luna 2.0 will show the world how 'truly dumb crypto gamblers are'.
luna 2.0 will show the world just how truly dumb crypto gamblers really are
— Shibetoshi Nakamoto (@BillyM2k) May 25, 2022