Almost 99% of Terra Investors Want to Destroy UST! But for Good

Terra users have voted to burn UST tokens and do away with algorithmic stablecoins

The collapse of the multi-billion dollar digital asset Terra spilled a wave of fear and panic among investors in the crypto market. As the market entered into a slumber, it became quite evident that after providing a myriad of opportunities to gain profits from digital assets, it is time for cryptocurrencies to take a break and let investors speculate about the future of their investments. While, Bitcoin dived lower than anybody could have ever imagined, from its all-time highs of US$67,000 back in November 2021, Terra also made its rounds by disintegrating its entire ecosystem. As the TerraUSD stablecoin fell, bringing down the value of the entire Terra ecosystem, investors thought it would be the perfect time to dump their crypto investments and move towards something more stable. Advocates still continue to argue Terra would soon regain its lost glory if the industry offers another opportunity. The Terra Founder, Do Kwon, has proposed several solutions to Terra's existing problems. Recently, his plan to relaunch Terra was finally accepted by his team, but along with this, almost 99% of the voters have opted to burn 1 billion UST tokens, which would help bring the system closer to its original dollar peg.

The fall of Terra was quite unprecedented. The crypto market was already in turmoil, which is one of the several reasons why investors especially relied on stablecoins to avoid the volatility of the market. But instead, the TerraUSD token lost its peg, proving that all cryptocurrencies are unstable, and it would not be safe for anybody to blindly follow the market trends and invest accordingly, without assessing one's own capabilities. Terra firm's recent attempts would considerably help the crypto and its stablecoin sister to gain some semblance of balance and convince investors that it is still in the game.

Terra Firm to Burn 1.3 billion UST tokens

The Terra governance system has approved the proposal to burn almost all TerraUSD tokens that are held in the project's community pool and also the UST tokens that were deployed for previous liquidity incentives on Ethereum. Approximately, according to reports, this amounts to more than 1.3 billion UST, or roughly 11% of the existing 11.2 billion UST supply. This initiative received almost 99% votes from the total cast who are responsible for Terra's development. Followed by this proposal, the core Terra team will move forward to execute the burn.

It is being reported that the entire process will take place in two phases. Firstly, the team will send almost 1 billion UST tokens from Terra's community pool to a usual burn module where they will be permanently removed from circulation. Then, they will manually bring 370 million UST to Terra from the Ethereum network to finally burn them.

Will these initiatives put Terra on the map again?

Besides burning UST tokens, Terra has decided to relaunch the chain and eventually release an airdrop. The new LUNA 2.0 holders would be subjected to holding Terra-based assets, but the new blockchain will not contain UST, meaning the firm is keeping aside its plan to include algorithmic stablecoins in its block. It does seem like there is still a ray of hope for Terra fanatics to retain their faith in the network. In fact, major crypto exchanges like Binance have also decided to give Terra another chance, following its relaunch decision. These initiatives might work but Terra developers would have to work extremely hard on its developments to ensure that its previous investor volume is regained back.