By now, the entire crypto-verse and the mainstream sector are well aware of the recent incident involving Terra (LUNA) and Terra USD (UST). Both digital assets have taken a huge hit in recent days and apparently, the protocols are still bleeding.
Terraform Labs’ CEO Tweeted the Problem
Due to the demise of LUNA and UST, a great wave of uncertainty has spread across the crypto-verse. Ever since the incident took place, crypto analysts and gurus are coming up with their proposals for the revival of the protocols.
The rescue of the projects has become the most discussed topic throughout the cryptocurrency sector. Millions of people who have invested their fortunes into LUNA and UST are praying for the problem to be solved soon.
Terraform Labs, the company behind the development of both protocols is now jumping into the scene to fix the problem for good. According to information, Do Kwon, the CEO at Terraform Labs has gone into detail explaining the dip for UST and LUNA.
Kwon provided detailed information surrounding the 71.07% & 99.93% dips recorded for UST and LUNA respectively. He not only talked about the origination of the issue but also talked in detail about the rescue plan for the protocols.
The Proposal 1164
Do Kwon reportedly shared the entire rescue plan through Terraform Labs’ Twitter account. He revealed that the rescue plan he has for UST is “Proposal 1164”. He claimed that Proposal 1164 will act as the primary strategy for fixing the May 11 mess.
He revealed that if the strategy is acted upon, it would balance the algorithm that goes behind the making of USD. The initial fix for the algorithm is to increase the base pool’s side to support UST. So far, Kwon’s proposal has received more than 50% approval with 220,000 votes.
In the proposal, Kwon has also explained how LUNA’s lost value can be recovered. He added that more UST will need to be burnt to recover LUNA. The proposal made by Kwon proposes three more emergency actions that need to be implemented to save UST and LUNA.
Three Emergency Measures
The first emergency measure would be to burn all the UST that are held within the community pool.
The second measure would be to proceed with burning the Terra USD that is present on Ethereum (the cross-chain). The cross-chain UST to be burnt translates to $371 million.
The third measure would be to proceed with the staking of LUNA. The proposed LUNA volume to be staked is 240 million.
If the proposal is granted approval and works as planned, it would help revive UST and LUNA’s lost values.