LUNA Go Forward Proposal

This document has been endorsement by both the TBA and TFL.

Motivation

While UST has been the central narrative of Terra’s growth story over the last year, the distribution of UST has led to the development of one of the strongest developer ecosystems in crypto.

The Terra ecosystem and its community are worth preserving.

  • Terra’s app ecosystem contains hundreds of developers working on everything from defi to fungible labor markets, state-of-the-art infrastructure and community experience
  • Terra Station has a large install base, with million+ users across the world
  • Although distressed, strong brand recognition and a name that almost everyone in the world will have heard about

$UST peg failure is Terra’s DAO hack moment - a chance to rise up anew from the ashes.

Summary

  • Fork the Terra chain into a new chain without the algorithmic stablecoin. The old chain to be called Terra Classic (token Luna Classic - LUNC), and the new chain to be called Terra (token Luna - LUNA)
  • Luna to be airdropped across Luna Classic stakers, Luna Classic holders, residual UST holders, and essential app developers of Terra Classic.
  • TFL’s wallet (terra1dp0taj85ruc299rkdvzp4z5pfg6z6swaed74e6) will be removed in the whitelist for the airdrop, making Terra a fully community owned chain
  • Allocate a large portion of the token distribution in 1) providing emergency runway for existing Terra dapp developers 2) align interest of devs with the long term success of the ecosystem
  • Network security to be incentivized with token inflation. Target staking rewards of 7% p.a.

Developer Mining Program

There are essential apps that must exist in any web3 ecosystem to be viable:

  • Infrastructure - Setten
  • Dex - Astroport, Loop, Terraswap, Pheonix
  • Explorer - Finder, terrascope
  • Payments / onramp - Kado, Alice
  • Wallet - Station, Leap, Falcon
  • Lending market - Mars, Edge
  • Analytics - Coinhall, Flipside
  • Staking derivative - Stader, Lido, STEAK, PRISM
  • Launchpad - StarTerra
  • Bridges - Axelar, Wormhole
  • Stablecoins - USDT / USDC bridged over
  • NFT exchange - Randomearth, Knowhere, Oneplanet, Luart
  • Insurance - Risk Harbor
  • Structured products - Nexus, Apollo
  • Games - UNOPND etc

… and others.

Essential app developers committing to launch on Terra will receive:

  1. Emergency allocation (0.5% of total supply): immediately after network launch to provide for runway while they build out product. Commit to returning funds if product has not been launched in 1 year.
  2. Developer Alignment Program (1.5% of total supply): Protocol teams that were live in Terra Classic divide this allocation weighted by the last 30 day TVL from Pre-attack snapshot - 1 year cliff, 3 year vesting thereafter
  3. Developer Mining Program (8% of total supply): Essential app developers earn a share of the mining program proceeds pro-rata to the amount of TVL every quarter for 4 years.

Essential app developers looking to join for emergency allocation should signal public support for the fork on Twitter and social channels.

Token Distribution

  • Community pool: 25%
    • Controlled by staked governance
    • 10% earmarked for developers
  • Pre-attack LUNA holders: 35%
    • All bonded / unbonded Luna, minus TFL at “Pre-attack” snapshot; staking derivatives included
    • For wallets with < 1M Luna: 1 year cliff, 2 year vesting thereafter
    • For wallets with > 1M Luna: 1 year cliff, 4 year vesting thereafter
  • Pre-attack aUST holders: 10%
    • 500K whale cap - covers up to 99.7% of all holders but only 26.72% of aUST
    • 15% unlocked at genesis; 85% vested over 2 years thereafter with 6 month cliff
  • Post-attack LUNA holders: 10%
    • Staking derivatives included
    • 15% unlocked at genesis; 85% vested over 2 years thereafter with 6 month cliff
  • Post-attack UST holders: 20%
    • 15% unlocked at genesis; 85% vested over 2 years thereafter with 6 month cliff

Definitions:

  • “Pre-attack” snapshot to be taken at at Terra Classic block 7544915 (2022.05.07 23:00:04+08:00)
  • “Post-attack” snapshot to be taken at Terra Classic block 7790000 (2022.05.27 03:59:51+08:00)

All tokens locked or vesting are staked at genesis, and must be unbonded to become liquid.

Technical details

  • Chain upgrade to commence in a few hours after the Launch snapshot
  • Snapshots can change depending on development readiness
  • Vesting all vesting block by block
  • Terra Core to be forked with the oracle , treasury , market modules removed - no UST
  • Luna eligibility includes Luna, bonded Luna, unbonding Luna, and staking derivatives

Roles & responsibilities

  • TFL (previously maintained mantle, station, finder, Terra Core) to prepare core public infrastructure, wallets, genfile, release binary for the launch
  • Validators (to volunteer) to declare gentx and coordinate launch shortly after the launch snapshot
  • Community leaders looking to provide oversight over the essential dev program should form a multisig to oversee the essential dev allocation & act as a steering committee for the new chain

Timeline

  • 05/17 - Announcement out
  • 05/18 - Governance proposal out
  • 05/21 - Terra Core release is cut, network launch instructions made available for validators
  • 05/25 - Essential app developer registration completed
  • 05/27 - Genesis file created from final launch snapshot
  • 5/27 ~ Network launch
211 Likes

Update: Strongly against this distribution.

There is no way we should allow 30% in total to post attack holders.

A large portion of them are gamblers care nothing about of Terra 2.0 other than Luna price, and will ruin our system.

165 Likes

What is the collateralized form? Feel like that’s the most important piece here.

I’ve been thinking thru some ideas but obviously would like to hear the initial proposal.

19 Likes

Wouldn’t giving staked Luna a distribution just centralize control in Lido, Prism and Stader? Since a large chunk of the community was in bLuna, stLuna, cLuna and Lunax

Also could you give clarification on Marginal Holders? That isn’t clear to me.

18 Likes

Not against this and could open up interesting discourse.

Some other things to consider:

  • We should be able to account for the many pseudo-LUNA stakers as well, e.g. bLUNA, stakers with PRISM in the form c/p/yLUNA, stLUNA, etc.
  • Snapshot for this is a very sensitive subject - needs to be clearly considered
  • 10% marginal holders doesn’t make sense to me, won’t people keep buying between now and go-live?
35 Likes

I am not happy with this. withdrew UST to exchange due to fears of losing all.

If you start new network and only cater for those with UST on chain then what happens to my UST off chain?

67 Likes

AFAIK it’s a reference to what Do mentioned in his recent tweets. UST that is collateralized against other assets, presumably like DAI, I think the mint-burn and arbing stuff for stabilization goes away.

2 Likes

bluna, lunax, stluna, cluna, lunax-luna LP

we all staked our luna with diff protocols in the network not only bluna

16 Likes

Am I reading right that marginal LUNA holders, thats people like me who fought to get their bags back after the attack managed to scrap together 10k LUNA at two feckin dollars will be give the worse deal… at 10% ? I’m already double rekt… so why not triple rekt I guess?

10% to Ecosystem developers (Dapps, service providers, infrastructure providers, etc)
Would this 10% include NFT projects?

32 Likes

Totally agreed, I substantially increased my bag in attempt to recover from loses, but instead I get even more rekt…

34 Likes

Yes like for instance on Astroport many have locked bLuna/Luna, that should count for the snapshot

8 Likes

We can’t agree to this without knowing the mechanism. That puts everyone in a helpless position if they decide to transfer.

14 Likes

Exactly, everyone on exchanges (Gemini, Kucoin, Coinbase, ect.) that is buying $LUNA to hodl and help you should be getting the bulk of this. They are your biggest supporters and only lifeline so far.

49 Likes

you should include UST holders at time of attack also as we have also lost big by believing in the network.

if it wasn’t for UST there would be no Luna.

Also I bought Luna to support on day of the attack at binance and lost 19k so had to sell as the bleeding wouldn’t stop. How are supporters of the network who acted in good faith looked after?

31 Likes

Sounds reasonable other than complaints about un-staked LUNA held or bonded (bLUNA and LunaX) at the time of the attack (which is a problem because we don’t want to reward anyone who had accumulated LUNA just for the attack.

Make sure you get the off-chain UST holders too - I’d moved some to SOL because I was worried about chain halts or attacks.

8 Likes

What about people that unstaked several days before the attack happened?

9 Likes

Agreed. Both snapshots should be taken just prior to the attack. Why would you screw the other side like that? Luna and UST holders are getting hosed.

13 Likes

This is FUD. User is not official and is brand new

7 Likes

Yes me also used a lot of UST to buy Lunax Bluna after the attack to support network and obviously hopefully profit in long run.

Snapshot should be done at network switch off time. Im sure nobody bought and delegated after the attack as everything was up in the air.

And if there have been any super big deposits since the attack they can be identified and decided what to do with.

Nobody can game this now as network is being patched to allow no further delegations.

5 Likes

I think a good compromise is allowing UST holders to either choose the balance from the snapshot before the attack or their current balance. Both groups are valuable UST holders, u can’t expect everyone to want to go down with the ship ie still be holding UST.

9 Likes