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The Terra ecosystem is set for a significant shakeup as a major token burn is coming. The TerraForm Labs (TFL) team has announced plans to burn all unvested LUNA tokens. Additionally, the team will burn any vested LUNA remaining in TFL’s wallets. This move promises a dramatic reduction in the supply of LUNA and LUNC tokens, but whether this will ensure the long-term viability of these tokens remains to be seen.
Impact on the Terra Ecosystem
The proposed token burn aims to reduce the supply of LUNA and LUNC, potentially increasing their value by making the tokens scarcer. The TFL team believes this could bolster the long-term viability of the Terra ecosystem. However, the true impact of this supply reduction will depend on various factors, including market demand and overall investor sentiment.
TFL Community Proposal and Next Steps
The TFL team will soon post a community proposal detailing the token burn process. This proposal will outline the specifics and allow the community to participate in the decision-making process.