Will USTC Recover? Terra Classic Community Discontinues Minting, Votes To Burn

TerraUSD Classic’s UST/USD minting will cease after a community vote on the stablecoin's governance forum.

This led to a 59% vote of approval to stop all USTC mining, while 40% opposed it. The community's proposal also ends all conversion of xUST to mint USTC.

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In the past year, the UST price eroded 64.1% in value as per CoinGecko data. The current price is 98.9% lower than the token’s all-time high level and it is at the center of Terra’s collapse. In comparison, Bitcoin BTC/USD and Ethereum ETH/USD prices increased 38.1% and 20.5% respectively in the past year.

The move is taken to favor the burning of tokens, which will lead to restoring its U.S. dollar peg. With the burning of tokens, the interests of the community and external investors will be protected, and the market supply will be reduced. Burning means deleting tokens permanently from circulation and shifting them to an address not controlled by anyone.

Terra Classic is the original network created by Terraform Labs and operates as an independent blockchain. UST is backed by a basket of assets like LUNA LUNA/USD and Bitcoin.

In a separate vote in mid-September, the community cast 93.2% vote in favor of increasing the minimum deposit requirement amount to 5 million LUNC from 1 million LUNC.

Crypto exchange Binance had previously agreed to burn LUNA Classic tokens to reduce supply and thus recover the price of its tokens.

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