Do Kwon, Terraform Labs founder, proposed a 'Terra Ecosystem Revival Plan' to restart the entire Terra blockchain. Under the plan, network ownership is set to be distributed completely to UST and Luna holders through 1 billion new tokens.
The plan comes as TerraUSD (UST) stablecoin, which is supposed to be pegged to the price of $1, "death spiraled" below 15 cents this week â wiping out over $30 billion in value. UST's sister token, LUNA, which propped up the stablecoin's value, has fallen to below a penny while LUNA was worth above $80 just a week ago, according to Coindesk.
Kwon revealed that there have been several community and validator groups discussing launching a fork of the Terra chain to make the ecosystem whole from the UST de-pegging event. "Wanted to offer my perspective on how this should be done."
New Transactions Were Stopped on Thursday
On Thursday, the blockchain behind the collapsed TerraUSD stablecoin and the affiliated Luna token had stopped processing new transactions for the second time in less than a day.
Terraform Labs had said on Thursday that entities responsible for verifying transactions on the blockchain, had taken the step to "come up with a plan to reconstitute" the Terra network.
Do Kwon Calls New Plan an Exciting Vision
Under the new plan, Kwon pointed out that even if the peg were to eventually restore after the last marginal buyers and sellers have capitulated, the holders of Luna have so severely been liquidated and diluted that we will lack the ecosystem to build back up from the ashes. "While a decentralized economy does need decentralized money, UST has lost too much trust with its users to play the role."
The founder has claimed that the rallying cry for the Terra community has always been "a decentralized economy needs decentralized money."
He called it an exciting vision as while UST has not been successful the Terra community will find ways of iterating on the idea at some point in the future.