Aftermath of the Luna-UST crash has Terra Blockchain’s image stained !!
Well, as a ex Luna and UST holder, those hard down the rock feelings were over a while ago, and I was ok with the complete end of Luna chapter.
There has been chaos with the Luna Blockchain after the aftermath of the spectacular UST-Luna death spiral because I read that Do Kwon fellow has been charged by investors of South Korea for committing financial crime by misleading them.
There were talks about Anchor Protocol being a Ponzi scheme because that protocol never made enough revenues for it to provide that 18% to 20% interest to UST depositors.
All that interest was paid out of Luna Protocol’s Reserves on which all Luna holders have stake on as Terra Blockchain claims to be decentralised.
Well, I don't know all that for sure, but Luna’s image is tarred for sure.
Transparency over how Terra’s Bitcoin Reserves was utilized to protect UST's peg absent
The crypto community long to have a proper report of how LFG had utilized its Bitcoin reserves to protect UST’s peg, wanting more transparency. I don’t think that transparent disclosure has been done by the Terra management.
Terra Revival plans with Terra2 launch coming soon…
However, Luna still is headed by Do Kwon in the background and Terra has plans to make a comeback without the UST with an upcoming hardfork making that possible.
The idea is that the popular apps of Terra like Astroport, Prism, Random Earth, Spectrum and Nebula that are considered good terra dapps stay alive migrating to the new hard forked terra chain.
Shrugs… as a UST holder of Anchor Protocol, this does not hold importance to me, what I wanted was compensation for my UST holding, that’s all, but …will come back to this.
Compensation for UST and Luna holders is airdrops of new Luna tokens
So, the new chain will be live really soon from May 27th, and well jargons…as this new chain that’s now Terra2, will have a genesis which is the Network’s first Block production phase that will have old holders of Luna and UST get airdrops of Luna.
The old Terra is now terraClassic, and the tokens held there are now LUNC and USTC…
So, looks like there will be no compensation for UST holders, as they will get airdrops of the currently worthless new Luna tokens!! This sucks!!
# I was hoping we UST holders would get 1$ worth of compensation for every UST we held which would have been a fair compensation for UST holders.
Anyway…
Proportion of Luna that’s going to be airdropped to Luna -UST holders
There is more, the point is there are still new things to keep updated for UST - Luna holders, even after that Blockchain has collapsed with things complicated and not straight forward with these airdrops.
Generally, everybody ought to be thrilled about things like airdrops, but in this case I am not because these airdrops are not the answer for UST compensation for UST holders who lost dearly believing UST will be what it's meant to be a decentralised stablecoin.
All UST and Luna holders get Luna airdrops not at once, but sequentially.
Snapshots of Luna Blockchain was taken on May 7th(pre -attack) and then on May 27th (post-attack) phase, and accordingly various token holders receive airdrops.
As I understand small token holders(relevant to me), receive 30% Luna token airdrops at genesis. 70% of remaining airdrops happen within a period of 2 years, with a 6 month cliff period.
This cliff period is the period where there will be no airdrops.
So, I guess this amounts to little amounts of Luna dropped every 6 months
Bigger token holders have longer cliff periods and coin vesting periods that can be checked in this article.
Airdrops for Luna Token holders outside of Luna Blockchain
Those other Luna holders who had their assets bridged to other Blockchains, can be included for airdrops if they manage to bridge back their assets before post-attack snap stop period ends.
Also, since Luna and UST holdings outside of the Luna Blockchain are not snapshot, the respective bridge contract will receive Luna airdrops and these air drops can be then distributed to asset holders who bridged their assets after the chain starts. Till then its community pool.
Conclusion - Will the new Terra 2 hold relevance?
Well what striked me about the original Luna, that’s now TerraClassic and part of crypto history books is their potential of creating decentralised stable coin pegs of fiat currencies of the various countries of the world. They were creating terraUST kind of stable coins for more currencies of the world and this was exciting.
However, that entire Luna has gone, and now this new chain will be aspiring to be another layer 1 Blockchain.
What is so special about that?, that too when Terra’s reputation is down under now.
Shrugs again… and psychologically, this entire Luna-UST crash episode still plays out because even if a Blockchain project is hot and well adopted by the crypto population I am not keen to step into that soon, until I feel super convinced that it's a solid project trying to understand risks o the project sinking !!
Anyway. Thankyou for reading everybody!!