Terra (LUNA) Proposes Revival Plan, Allocating $248M For 'Fixing Errors'

Developers of the Terra stablecoin ecosystem, which includes Luna Classic (CRYPTO: LUNC), TerraUSD Classic (CRYPTO: USTC), and Luna 2.0 (CRYPTO: LUNA), proposed an expansion plan in which they would allocate 95 million LUNA ($248 million) to incentivize development and fix errors within the ecosystem. 

What Happened: According to the original proposal drafted in May, Terra planned to allocate around 10% of the LUNA supply to the ecosystem, with 80% of the funds being used for developer mining rewards. 

Terra staff, however, contended that there are currently only a handful of projects with total locked value on the protocol, and mining revenue would not be distributed properly without competition.

LUNA is the native token built by the Terraform developers to counterweight the Terra stablecoin and absorb its volatility.

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What’s New: The new proposal consists of reducing developer mining rewards from 80 million to 20 million LUNA while reallocating 50 million LUNA as liquidity mining rewards to encourage decentralized exchanges on the Terra platform. Additionally, 20 million LUNA will be given as developer grants per project per year up to 125,000 LUNA for recipients.

Over 5 million LUNA will be given to users to incentivize engagement. A separate group of two validators, two community members, and three TerraForm Labs members will manage the treasury. 

The Terra Luna ecosystem lost around $40 billion in a week of intense selloffs earlier this year, as the algorithmic LUNC-USTC coin pairing spiraled out of control. 

Price Action: The live Terra price today is $2.64. It is down 0.58% in the last 24 hours, as per CoinMarketCap. 

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