• The L1 Joint Task Force of the LUNC community has proposed a test environment specifically geared towards repeging USTC.
• The proposal includes penalizing USTC holders for selling below its assumed peg at $1, creating a special staking vault, and creating a liquidity pool between USTC and LUNC.
• Several members have opposed the initiative due to the divergence fees it would include.
L1JTF Proposes USTC Repeg Test Environment
The Layer-1 Joint Task Force, a developer team made of Terra Luna Classic (LUNC) holders, has proposed a test environment specifically geared towards repegging USTC. The idea is to penalize USTC holders for selling below its assumed peg at $1, create a special staking vault, and create a liquidity pool between USTC and LUNC.
Terra Classic USD (USTC) Trading Below $0.015
Despite several proposals to revamp Terra Classic USD (USTC), the stablecoin still trades way below its expected value of $1. Currently, it stands at approximately $0.015 with LUNC inks 1.5% daily gains.
Repeg Proposals for USTC
Several additional ideas have been proposed to help revitalize the deteriorated Terra Classic blockchain. These include burning $LUNC and an AI chain app as well as creating implied divergence fees on trading which could be used to reduce the supply of malfunctioned stablecoin USTc if successful.
No Extra Funds Needed For Test Environment
Fortunately, no extra funds are required to set up this test environment as the previously passed proposal #11462 took care of that by providing development funds for work on LUNC’s Layer 1 in Q2 of 2023 ($124K).
Opposition To Divergence Fees
Although many members are supportive of this initiative overall, there is opposition due to the divergence fees it would include – which may not be accepted by major exchanges – as well as other concerns such as time away from parity efforts being diverted towards this initiative instead.