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Binance Adjusts Terra Luna Classic Burn Mechanism

Binance reduces Terra Luna Classic burning by 50% and delays the next batch to March 2023, impacting LUNC prices.
Published on 2022-12-28

Binance's LUNC Burn Changes

Binance, the leading crypto exchange by trading volume, recently announced significant modifications to its Terra Luna Classic (LUNC) burn mechanism. The exchange will now burn 50% of all LUNC spot and margin trading fees instead of the previous 100%. This change is set to take effect on December 28th.

Delay in LUNC Burns

Additionally, Binance has postponed the next batch of LUNC burns to March 1, 2023, from the originally planned January 1, 2023. This delay is attributed to the need for token re-mints following Terra Classic proposals 10983 and 11111. Binance is coordinating with the Terra Grants Foundation to implement essential adjustments. A new burn wallet will be established to prevent the re-minting of LUNC tokens, and Binance seeks to whitelist its LUNC wallet to avoid taxes during wallet transfers. However, if these changes aren't made, Binance may cease LUNC burning altogether.

Market Reaction

Following the announcement, Terra Luna Classic experienced a 13% price drop within 24 hours, trading at $0.0001606. This decline came after a recent rally where LUNC surged nearly 50% due to a breakout from a descending channel.

Binance's Role in LUNC Burning

Since initiating support for LUNC burning in September, Binance has emerged as the largest LUNC burner, eliminating over 20 billion tokens, accounting for more than 50% of the total burn. The updated burn mechanism underscores Binance's commitment to aiding the Terra Classic community in reducing the LUNC token supply, despite the recent adjustments.

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