LUNA Update: The Rescue Plan For The Terra Ecosystem

The crypto space has been hit with the greatest fiasco ever for the past few weeks (May 2022).

We saw the crash of the Terra ecosystem which dragged its stablecoin, UST alongside.

Indeed, how are the mighty fallen!

Asides from stripping investors of their life savings, it also left many speculating if the Terra ecosystem is gone for good or if there’s still hope for it.

This article will let you in on the steps that Do Kwon and his team are taking to ensure they get back on their feet.

Happy reading!

Terra 2.0: LUNA’s Current Update

LUNA update

The team at Terra has come up with a governance proposal (Prop. 1623) for a new blockchain.

Now, a ‘new blockchain’ does not refer to a cryptocurrency fork of the existing chain.

Rather, it refers to the creation of an entirely new chain.

The thing with ‘forks’ is that the new chain traces its history to the original chain.

But Terra 2.0 will not.

If Prop. 1623 goes live, we will have a brand new blockchain that will be created from genesis block 0.

No past history will be shared with the previous chain.

This new blockchain will be Terra and will have Luna (LUNA) as its token. It will not be linked with any Terra stablecoins.

The old blockchain will now be Terra Classic and its token will be Luna Classic (LUNC). It will retain the stablecoins on the Terra ecosystem.

Owing to Terra being a new chain, DApps from Terra Classic will have to migrate to the new chain.

Most popular DApps like Spectrum Protocol, Astroport, Prism Protocol, Stader labs, etc. have signaled their support to migrate to Terra 2.0.

Let’s look at how the Terra 2.0 plan will be executed if it is eventually passed.

Scroll down.

How Will This Work?

It is proposed that the new LUNA tokens will be airdropped to LUNC holders, stakers, residual UST holders, and the essential app developers on Terra Classis in the following proportions:

DApps Developers

The DApps developers that will be migrating to Terra 2.0 will receive the following:

  • Emergency allocation: 0.5% of the total supply
    • This will be given immediately after the network launch to fund the runway while they build out the product.
    • Note that the funds will be returned if the product is not launched after one year.
  • Developer Alignment Program: 1.5% of the total supply
    • The protocol teams that were live in Terra Classic will divide this allocation
    • This will be weighted by the last 30-day TVL from the pre-attack snapshot – 1-year cliff, 3 years vesting thereafter.
    • Accommodations will be made for apps where TVL is not applicable.
  • Developer Mining Program: 8% of the total supply
    • The essential app developers will earn a share of the mining program proceeds
    • This will be in proportion to the amount of their TVL every quarter for 4 years.

LUNA Token Distribution

  • Community pool: 30%
  • Pre-attack LUNA holders: 35%
  • Pre-attack aUST holders: 10%
  • Post-attack LUNA holders: 10%
  • Post-attack UST holders: 15%


  • The Pre-attack snapshot will be taken at Terra Classic block 7544910 (2022.05.07 23:00:04+08:00)
  • The Post-attack snapshot to be taken at Terra Classic block 7790000 (2022.05.27 03:59:51+08:00)
  • About 30% of the token will be released at genesis while the remaining 70% will be vested over a period of 2 – 4 years with a 6-month cliff. This depends on your wallet size.
  • Check here for more details on the distribution


  • Will the Team be able to pull this off? 
  • Does this plan hold any hope for the revival of the Terra chain? 
  • Will this in any way placate those investors who got rekt?

Find my opinion on these questions in the section right below.

My Take on Terra 2.0: Yay or Nay?

For starters, I will want to state categorically that whatever opinion is stated here remains solely nothing but ‘my opinion’.

It should not in any way be misconstrued to be a piece of financial advice.

Financial advising is not part of my professional portfolio yet.

Okay… air cleared! Let me tell you what I think of Terra 2.0.

I’m still of the school of thought that thinks the Terra team is:

  • either still confused
  • or just putting up a face to seem something is being done to salvage the situation

Stay with me as I explain further.

The LUNA Coin Burn Address Stunt

What happened was that on 21st May 2022, Do Kwon put out a LUNA wallet address at the request of the community to send their tokens for burning.

This is in a bid to reduce the number of LUNA in circulation and help salvage the situation.

But on the 23rd of May 2022, he came back again to say the community should desist from doing that.


‘How do you put out a coin burn address and come out 2 days later to say there’s no need to send tokens there unless you want to lose your tokens?’ 

On top of that, he added an adjoining note that ‘….want there to be no confusion whatsoever.’ 

That act alone has orchestrated confusion already.

When asked why he had to send it out, the reply was that it was for ‘information purposes‘ as the community kept asking for it.

I mean: why put out the address in the first place only to retract it later?

It cut across like the community (just like hungry dogs) were thrown a bone to munch on pending when a proper dog food (in this case, a lasting solution) is made available.

The Distribution Plan

Looking at the distribution plan, it states that 30% only will be unlocked at the genesis and the rest will come in 2 – 4 years.

This indirectly translates that the investors will be getting back the bulk of their funds in 2 – 4 years.

That, to me, is a bit unfair. 

Lives were lost because of this and many still alive have lost their life savings.

All because of what? They ran with the Terra vision.

Now, don’t get me wrong here. 

I know the Golden Rule of investing states we should only invest what we are willing to lose. 

But the blame here (to me) should go more to the Terra Team as they acted a bit too late.

They keep telling the community that ‘all is well‘ till it got out of hand.

It was then that the Team woke from their slumber to rectify an already dying situation.

So, to me, the first step would be to get back the investors’ funds to them ASAP.

Is There More To This?

In the news, the Korean Police have placed Terra Labs under their radar.

Now, the failed project has become a crime to be investigated.

Well… unless further news and clarity emerge from Terra’s plan, it’s a ‘Nay’ for me.

The unchecked boxes for me are still much.

Now, unto the last part!


Here you have the update to the Terra/Luna saga!

Hope you enjoyed reading through it?

Judging from the stats so far (25/05/2022), the community seems to be affirming the proposal.

As you can deduce from my thought, it’s still not clear to me the direction the Team is headed.

Guess it’s another one we’ll have to sit out.

But wherever the Terra/Luna path leads, I will keep updating you with the latest information.

Let me know your thoughts too in the comment section below. I will be looking out for that.

Finally, I will really appreciate it if you share this post using any of your fave social media buttons below.

See you in my next post!

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