Terra Classic Launches MM 2.0 Amid Do Kwon Court Appearance

The Terra Classic (LUNC) community has introduced a major update with the launch of the Terra Classic Market Module 2.0 (MM 2.0), coinciding with the court appearance of Do Kwon, the founder of the Terra ecosystem. This new module is designed to enhance the TerraClassic ecosystem without the need for minting new tokens, marking a departure from the traditional "mint and burn" mechanism.

The MM 2.0 version includes several key features aimed at reducing inflation risks. These features include multi-layered restrictions on minting, such as SDR base, PRP limits, and daily minting limits based on burn history. The module is instantly available and includes a swap fee of 0.35%, with half of the fee being burned and the other half sent to the Oracle Pool. Additionally, up to 80% of the LUNC burned in the past 30 days can be minted, with a maximum limit of 100k SDR.

The new clearing system operates on a pre-funded pool, eliminating the need for new LUNC minting in swaps. Users can exchange USTC for LUNC and vice versa from this pool. The system charges a 0.35% fee on each swap transaction, with half of the fee being burned and the other half transferred to the Oracle Pool. This approach aims to maintain a balance in the ecosystem and potentially accelerate USTC burns.

However, despite the security measures in place, there is a risk of disappointment if the community's expectations from this mechanism are too high. The new system may lead to the pool being depleted if swaps are concentrated only in the USTC-LUNC direction, potentially falling below expected LUNC burn rates. This could accelerate USTC burns but may also impact the overall stability of the ecosystem.

The Terra Classic community has been proactive in implementing updates to address the challenges faced by the ecosystem. The MM 2.0 update is a significant step towards enhancing the stability and functionality of the TerraClassic ecosystem, although its long-term impact remains to be seen. The community's response and the effectiveness of the new module in achieving its goals will be crucial in determining the future of Terra Classic.