The founder of Terraform Labs called the burning of LUNA coins a useless undertaking

Terraform Labs founder Do Kwon believes that destroying LUNA coins to create demand for them will not help increase their value and revive the project’s ecosystem.

The LUNA coin and the UST stablecoin are still struggling with heavy bearish sentiment in the market, and the Terra team is trying to find an effective way to restore their value after the recent collapse. One of the proposed ways to support the LUNA rate is to burn excess coins. Many users are convinced that this move will reduce the number of coins in circulation, which will create demand for them and increase their value.

Do Kwon, at the request of users, posted on Twitter the address used to destroy LUNA. However not surethat it will do the project any good, except that people will just lose their coins, and more confusion will result.

The Terra community has been trying for days to convince Do Kwon and the Terra team to start burning LUNA coins. Formerly CEO of Binance cryptocurrency exchange Changpeng Zhao lamentedthat Do Kwon did not take advantage of the opportunity to use the reserves to support the price of the coin as soon as it began to fall.

According to Zhao, Kwon should have been destroying LUNA, not “minting” more coins, as it would be naive to think that issuing more assets would increase its value. Recently, Zhao also criticized the idea of ​​forking Terra, believing that it will not bring any benefit to the community, but will only dilute the share of the current owners of UST and LUNA.

Note that the Binance exchange actively practices burning BNB coins, using this mechanism to reduce the supply of crypto assets and increase their value. In January, the marketplace hosted its 18th quarterly BNB burn, which saw the first use of a smart contract that calculates the number of coins to burn.

However, Cardano founder Charles Hoskinson has the same point of view on coin burning as Do Kwon. Previously, Hoskinson called such actions a robbery of users and indulgence in the greed of people seeking to cash in on crypto assets.


Source: Bits

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