binance announced The exchange began applying a 1.2% tax burden on Terra Luna Classic (LUNC) transactions.
The announcement said:
“Binance will cover all trading fees for LUNC spot and margin trading pairs at LUNC write address“
The calculation of the total LUNC to write is done every Monday of the previous week at 00:00 UTC. The amount of LUNC burned, its USDT equivalent, and its on-chain transaction ID will also be revealed in the announcement post every Tuesday at 00:00 UTC.
change of plan
On September 23, Binance CEO Changpeng Zhao (CZ) was asked about the LUNC tax burn during an AMA session on Twitter, explaining why Binance will not apply the burn. CZ came up with another approach to the problem a few hours after the AMA.
He suggested implementing an opt-in button for LUNC holders to switch on if they wish to apply the tax burn. or remove it completely.
However, on September 26th, CZ tweeted that Binance had abandoned plans to implement an opt-in option. The main reason is that it has a bad reputation in the community and takes too long to develop.
Three things here:
1) The LUNC community was not happy with this approach.
2) Development takes time.
3) It just doesn’t work. Our traders don’t vote for it.Since then, we’ve been talking about better, faster ways to support our community.
— CZ🔶 Binance (@cz_binance) September 26, 2022
Instead, the Binance team decided on a LUNC burn plan to meet the demands of the LUNC community and maintain a positive trading experience.
Details and Affected Prices
Binance’s write decisions are also applied to previous LUNC transactions. According to the announcement post, the first batch of LUNCs written will be calculated from September 21 to October 1, 2022 at 00:00 UTC. However, LUNC spot and margin trading fee rebates from September 21st to September 27th are excluded from the calculation.
This new mechanism fulfills the wishes of the LUNC community without impacting pricing. To ensure the tax burn system is fair for all users, CZ said:
“Instead, we have decided to burn all trading fees collected on LUNC/BUSD and LUNC/USDT Spot and Margin trading pairs on Binance. Fees will be converted to LUNC and sent to the write address. will be paid at our expense, not at the user.”
If transaction fees for LUNC spot and margin trading are collected in tokens other than LUNC, the tokens in question will be converted to LUNC at the real-time exchange rate prior to burning.
