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- Terra Luna Classic (LUNC) developers have completed the development of the Oracle Split, an update that is expected to spur a surge in staking.
- The split will divert community pool rewards from tax burns into the Oracle Pool, with the update expected to take effect on July 26 at block height 19060800.
With staking being the pillar of any healthy DeFi ecosystem, the developers of Terra Luna Classic (LUNC) have announced a long-awaited update that will massively boost staking rewards in the ecosystem.
As Crypto News Flash reported last month, one leading LUNC developer had proposed adjustments to the network’s burn tax distribution. His proposal allocated 10% of the tax to the Oracle Pool. In the Terra Luna Classic ecosystem, the Oracle module furnishes the network with up-to-date price feeds of exchange rates in the real world and is the foundation of the network’s DeFi.
As one of the key developers revealed Wednesday, the Oracle split logic has finished and the testnet is ongoing.
✅ Oracle Split Logic Finished.
⌛️ Testnet ongoing.
📖 Commonwealth is out.https://t.co/8kfpc8yN51— fragwuerdig | 🧑⚖️ (@frag_dude) July 10, 2024
The Oracle split is contained in proposals 12098 and 12114, which are part of Release v3.1.0. It will divert community pool rewards to the Oracle Pool, slowing down its depletion rate (the rewards originate from the tax split.
Under the existing mechanisms, Terra Luna Classic has a 0.5% burn rate—80% of it goes to burns, and the remainder is distributed to rewards and the Community Pool. It is this 20% that the new proposal targets, recommending that it be split between the Community Pool and the Oracle Pool.
The proposal isn’t popular in some quarters. A key grievance is its obvious implication on block rewards for LUNC validators—under the new mechanism, block rewards would come exclusively from gas fees. The annual percentage rate is also expected to dip by 0.5%. Some experts have even warned that passing the proposal could lead to immediate price declines.
Terra Luna Classic proposes adjustments to the LUNC burn tax distribution, possibly leading to further price declines. The plan allocates 10% of the tax to the Oracle pool, enhancing staking. Developers target completion by mid-July, foreseeing initial price volatility. Seeking… pic.twitter.com/vtowCJCvKk
— Collin Brown (@CollinBrownXRP) June 11, 2024
However, the proponents point out that this shift would benefit the ecosystem in the long run, primarily by boosting staking.
LUNC staking has grown massively in recent months. As Crypto News Flash reported two weeks ago, the staked LUNC hit 1 trillion amid aggressive growth since the start of June. This growth continues, with the community staking just under 250 million LUNC in the past 24 hours and over nine billion tokens in the past week. Overall, staked LUNC accounts for 15.09% of the total tokens, sitting just marginally below the all-time record achieved last October.
On the trading front, LUNC has dipped slightly over the past day to trade at $0.00007117 amid a 21% drop in the trading volume.
As one analyst points out, the token has been trading inside a falling channel and changes hands below its 50-day and 200-day simple moving averages (SMAs). If it finds strong support, the analyst expects LUNC to surge 67% and hit $0.00017. However, if it fails to hold up, the next support will be further down at $0.00005646.
(Image courtesy of Mirko Dee).
