Luna Classic Price Continues To Plummet Despite Impressive Tax Burn Rate
- 1.2% tax cut proposal now in effect
- The proposal will end when the total LUNC supply reaches 10 billion
- Shares of Luna Classic were down $7.22 at $0.0002805 as of 1:45 a.m. ET Thursday.
After approving and implementing the 1.2% tax cut, the Luna Classic community saw a staggering amount of tokens sent to dead wallets in just a few hours. Still, the price does not appear to have recovered as it is still in a downtrend.
The Luna Classic tax parameter changes took effect Wednesday and will continue until the supply reaches 10 billion tokens.Interestingly, a few hours after the proposal was implemented, data from LUNC validator Stakebin report This 9,456,872 has been burned from the current total supply of 6.9 trillion.
The 1.2% tax cut proposal states that Luna Classic deposits and withdrawals through the Terra Classic network will be affected. For deposits, the transaction will be taxed by the Terra Classic network before reaching the cryptocurrency exchange.
After deduction of 1.2% tax, the balance will be credited to the user account in the specific CEX. For withdrawals, users will receive the amount withdrawn minus withdrawal fees charged by cryptocurrency exchanges and a 1.2% tax deduction for the network.
According to the proposal, the main goal of the “tax + burn” mechanism, which imposes a 1.2% burn tax on each sale and purchase transaction, is to “reduce the total supply of Luna Classic.” After the supply reaches the 10 billion target, the 1.2% burn mechanism will be “disabled”.
Burning a coin or sending it to a dead wallet is a common practice in the cryptocurrency world, provided it positively affects the price of the coin. This is an economic principle based on the law of supply and demand, if demand increases and supply decreases, prices will soar.
Interestingly, the price of the first Terra native token continued to trade in the red zone despite burning over 9 million LUNC through the tax burning mechanism. LUNC was trading at $0.0002804 immediately after the tax cut was implemented and briefly gained 0.713% when it traded at $0.0002824.
According to the latest news, Luna Classic shares were down $7.22 at $0.0002805 as of 1:45 a.m. ET on Thursday, with a 24-hour trading volume of $553,745,853 data From CoinMarketCap.