In its heyday, USTC (formerly known as UST) was one of the top stablecoins in the market, allowing users to freely exchange UST for LUNA. However, since UST was heavily depegged in May 2022, this mechanism has failed as billions of LUNA tokens were issued, burying the value of UST.
Recognizing the significant risk, the Terra Classic community proposed to halt the issuance and reissuance of Terra Classic USD (USTC) to protect the community and investors in an effort to revive USTC.
On September 21st, the proposal was officially approved with a 59% consensus rate.
With this new proposal, the Terra Classic community hopes that USTC will regain its peg to 1 USD by burning billions of tokens that were created during the collapse. Up to now, the community has only burned 75 billion tokens, which is about 1% of the nearly 6 trillion tokens in circulation.
At the time of writing, USTC is trading around $0.012, after a slight increase to $0.0134 on September 24th.
Currently, the leading market exchange Binance is making efforts to support the burning of LUNC. In early August 2023, Binance burned 1.14 billion Terra Luna Classic (LUNC) tokens in the 12th round of the Terra Classic burning mechanism.
As for the founder of Terraform Labs, after the Terra ecosystem collapsed, Do Kwon went into hiding to evade legal issues. However, after a long period of playing hide and seek, Do Kwon was finally arrested in Montenegro and is facing imprisonment.