Binance to support Terra Classic (LUNC) burn, CEO Zhao says

Binance, the world’s largest crypto exchange and trading platform, now supports the burning model for Terra Classic (LUNC), Changpeng Zhao’s firm said in an announcement on Monday.

According to the platform, support for LUNC burn at a 1.2% fees rate is in response to a community proposal that aims to help reduce the circulating supply of the token. As such, Binance will implement the burning mechanism that sees trading fees on all spot and margin trades sent to a burn address.

Binance wrote on its blog:

“The specific amount of LUNC to be burned, its equivalent value in USDT, and on-chain transaction ID will be updated each week in this announcement until further notice.”

Binance had proposed an opt-in burn mechanism

On Friday last week, Binance CEO Changpeng Zhao announced that the exchange would support an opt-in mechanism for the 1.2% fee burn per transaction, highlighting the potential that implementing it across all trades would likely see traders jump onto other platforms that are yet to support the burn.

The idea was for an opt-in button that would first go live when 25% of the total LUNC on the exchange get on board. After that, Binance would have implemented the burn across all LUNC trades when opt-in users hit 50%.

The announcement drew criticism from the LUNC community, with many latching onto a #BoycotBinance hashtag.

On Monday, Zhao commented on change:

“Since my AMA on Friday, we’ve had a number of discussions about how Binance can better support the LUNC community’s requests for TX tax burns. The last thing I said was we will implement an opt-in button. This has since changed.”

Zhao explained the decision to scrap the opt-in plan as down to three reasons – which he shared on Twitter.

Instead, we have decided to begin burning all trading fees collected on the LUNC/BUSD and LUNC/USDT spot and margin trading pairs on Binance.

Fees will be converted to LUNC then sent to the burn address. The burn is paid at our expense, not the users’.

— CZ 🔶 BNB (@cz_binance) September 26, 2022

The Binance chief added in tweet:

“This way we can be fair to all users. The trading experience and liquidity remain the same, and Binance can still contribute to the supply decrease of LUNC, which is what the community wants.”

LUNC is up by more than 34% in the past 24 hours, and is likely to go higher after a dip on Monday morning. As Invezz reported, the dip followed news of an Interpol ‘Red Notice’ on Terra founder Do Kwon.