Binance Adds an “Opts-In Button” For a 3-Step Tax Burn on Terra Classic (LUNC)
The CEO of Binance, Changpeng Zhao (CZ), announced that the proposed implementation of a 1.2% tax burn for Terra Classic (LUNC) is challenging on a centralized platform like Binance.
Binance Proposes Options for a 1.2% Tax Burn for LUNC
According to Binance, centralized exchanges can make adding the 1.2% tax burn daunting. As a result, an alternative way would be welcomed to allow users to support the tax burn move.
However, Binance has announced it is considering implementing a 3-step “opts-in” process for tax burn on LUNC transactions.
Furthermore, the exchange noted that the opt-in button would allow people to authorize the tax burn rate on their LUNC trading. In addition, Binance will begin to charge a 1.2% tax for every opt-in transaction. Meanwhile, this is subject to change when the quorum has attained 25% of the total supply of LUNC on Binance.
Traders who do not vote are exempted from the charges on their LUNCH transactions.
Moreover, the exchange would implement a 1.2% tax burn for all traders when the opt-in has achieved 50% of the LUNC trading volume. This will prevent whales from influencing voting because they are not active traders.
If the 25% threshold is not attained within a month after the launch of the opt-in button, the exchange will disable the feature.
Meanwhile, some believe CZ’s point of view is the right thing to do as traders decide how they can be taxed. On the other hand, some want Binance to manage the 1.2% tax burn call as it represents almost 25% of LUNC’s supply.
CZ Speaks
The Binance CEO believes that the 1.2% tax burn would open another issue in the blockchain ecosystem. CZ noted that use cases would become meaningless due to the tax burn rate on LUNC.
CZ added that a spike in charges would impact transaction volume on Binance because people would cease trading. Meanwhile, Binance has added the 1.2% tax burn for on-chain transactions involving LUNC.
Moreover, due to CZ’s refusal to implement tax burn for off-chain transactions, the price of LUNC takes a plunge. In the meantime, Terra Classic trades at $0.00025, down almost 8% over the past 24 hours.
The Rise of the LUNC
Following the Terra LUNA ecosystem crash, Terra Classic attempts to compensate for the massive loss. September has been an excellent period for LUNC as it outperformed all top-ranking tokens.
Despite its association with the infamous Terra LUNA, the token is experiencing a comeback. Moreover, the Terra Classic Protocol was developed as part of the rebranding of the Terra Network.
It initially took a major hit after its launch but eventually gained investors’ confidence. Developers of the Terra Classic have done well to add a staking service that has impressed investors and traders.
The broader impact of the collapse of the Terra network on the crypto industry is calamitous. However, Terra Classic is taking the opportunity to make things right again.
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