Proposal: Project Dawn, Burn Unlocked Luna for UST

The core technology of Terra is UST, and its fleet of decentralized, censorship resistance stablecoins.

For a myriad of well established reasons, UST is the best money currently available. However, centralized, fiat backed stablecoins still proliferate and dominate the market.

Thus, the apex goal of the Terra ecosystem should be expanding the adoption and depth of UST, until UST becomes the dominate form of money.

It cannot be denied that Project Dawn is critically needed to harden Terra’s infrastructure and technology, but Project Dawn can also simultaneously serve an equally important goal - expanding UST.

I propose TFL commits to burning all Luna unlocked for Project Dawn to UST, before being distributed to partners/projects. Doing this would directly contribute to the expansion of UST. Partners/projects would also then transact in UST furthering its reach.

Project Dawn provides the ideal framework to steadily grow UST in a constructive way. This opportunity should be seized to the betterment of the entire Terra ecosystem.

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This is smart!

I suggested the same thing here 2 months ago btw, there wasn’t much response.

Unless presented with good reasons not to, I’d be in favor. People should be getting used to transacting with UST, not Luna.

Hey Ultor, this is really thoughtful, and I see where you are coming from. A few thoughts:

  • While there are some short term differences, keep in mind that UST is just a Luna derivative, and there is no long term difference between an increase of UST circulation in the market and Luna circulation in the market from a pure technical perspective.
  • Sometimes we will need to incentivise stakeholders in Luna rather than UST - this aligns incentives with our counterparties such that everyone wants the project to do well in order to increase the value of Luna. To not do this results in inefficient spending - one of the many reasons why public spending tends to be less motivated and efficient than startup ingenuity, mostly driven by equity.

Understand that it could seem worrisome to deployment of large amounts of capital, and admittedly we haven’t announced details on what is launching yet - we will have more clarity soon on some of these new initiatives in the Nov-Dec timeline.

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