Terra Classic Soars As Binance Appeases Crypto’s Lunatics

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Terra Classic's LUNC token is up 35% today. The increase follows an announcement from Binance detailing plans to burn LUNC trading fees. Terra Classic introduced a 1.2% burn tax on Sept. 20, but rocky market conditions and the search for Terraform Labs CEO Do Kwon have put significant pressure on the project.

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After Terra Classic implemented a 1.2% burn tax on all on-chain transactions, Binance introduced trade fee burn.

Binance to burn LUNC trading fees

Months after crashing to zero, Luna Classic is growing.

According to CoinGecko data, Terra Classic's native token is trading at about $0.0003 today, spurred by Binance's announcement that it plans to fire up LUNA Classic trading fees. In a blog post on Monday, the world's top cryptocurrency exchange revealed that it would be burning transaction fees in the coin's space and trading pairs. Although the announcement did not confirm the amount to be burned, he said the blog post will be updated weekly with on-chain data showing tokens burned.

Binance and other crypto exchanges have faced calls from the Terra Classic community called “Lunatics” to start burning LUNC tokens after the blockchain introduced major changes to Tokenomics last week. On September 20, Terra Classic implemented a 1.2% “burn tax” on each transaction, with the aim of reducing the total supply of LUNC tokens from 6.9 trillion to 20 billion. In theory, the tax was meant to increase the price drop on the token, but it saw a sharp decline last week as supply dwindled. according to Data from TerRarityAbout 1.8 billion LUNC were burned last week. That's the equivalent of $540,000 at today's prices, enough to make up just a little bit of Terra Classic's $2 billion market capitalization. It is important to note, too, that LUNC has had a rough month with the broader crypto market aside from today's boost; It's down 50% since September 8th.

Comments on CZ burning

Binance CEO Changpeng “CZ” Zhao commented on the burn on Twitter Monday, explaining why the company chose to burn over its earlier plan to launch opt-in trading. “Payments are converted to LUNC and then sent to the burner address. The burner is paid at our expense, not by the users,” he wrote. “This way we can be fair to all users.” The trading experience and the amount of money are the same, and Binance can still contribute to the decrease in the supply of LUNC, which is what the community needs.

It's been a rough few months for the Terra community and its central figures since the Terra blockchain and UST stablecoin suffered a $40 billion loss in May. Terra then became Terra Classic, and a new blockchain called Terraform Labs Terra 2.0 was spun off from the failed UST stablecoin. Terra 2.0's LUNA token also rallied in double digits today, breaking $2.76 after weeks of declines. The debacle of LUNC and LUNA comes hours after it was announced that Terraform Labs CEO Do Kwon was placed on the Interpol Red Notice for his role in the collapse of Terra. The Korean entrepreneur last told his Twitter followers on September 17 that he was “not on the run.” The red alert means it is now wanted in 195 countries.

Disclosure: At the time of writing, the author of this article owns ETH and several other cryptocurrencies.

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