Terra Money’s Twitter account shared details of Do Kwon’s initial rescue plan, which included expanding the base pool and burning UST as well as staking LUNA.
The Terra rescue story continues. Terra Money’s Twitter account, Terra Money, posted more details about Do Kwon, Terraform Labs CEO, and his rescue plan for UST.
This thread provides information on Proposal 1164, Do Kwon’s initial strategy for Terra starting May 11. The proposal would improve the balance of the algorithmic stablecoin Terra USD(UST) by expanding its base pool. The proposal received 220,000 votes at more than 50%.
Also, the tweet thread explains that there is an “oversupply” of UST. explains Terra’s ( LUNA ), “dilution” or price decline. They must now burn more UST.
“The main obstacle is to get rid of the bad debts from UST circulation quickly enough to allow the system’s health to be restored.”
There are three options for emergency actions, one of which focuses more on burning UST.
Shared by The Intern at Terra Research forum. The site details that the total amount of UST to be burned should reach 1.4 billion UST or “11%” of outstanding UST liabilities.
The team believes that increasing the base pool of the coin and burning more will save UST.
Three, the stake of 240 million LUNA will reportedly improve the governance of the TERRA network.
Some observers believe that staking 240million LUNA (roughly equivalent to $200 million) is not enough to save this project.
Others have suggested that Proposal 1164 will accelerate LUNA’s ongoing “death spiral”.
Cointelegraph reported previously that the crypto community was quick and responsive to Kwon’s algorithmic stabilitycoin. Additionally, there have been other theories about an “attack” on the ecosystem that was orchestrated by rival players.