Terra Classic’s (LUNC) 1.2% Tax Burn Kicks Off

• Terra Classic’s 1.2% tax parameter on all on-chain transactions is officially live.
• The 1.2% tax rate is set to go until the total LUNC supply sits at 10 billion tokens.

The  Terra Classic army anticipated exclusively the day when the  Terra Classic’s tax parameter change will go live. The D-day is finally here.

As proposed by one of Terra Classic’s community members, Edward Kim,  Terra Classic users will be charged a 1.2% tax on all on-chain transactions. The tax fee charged goes directly to the Terra burn wallet which will minimize the number of LUNC tokens in circulation.

Currently, the total LUNC in supply is hovering around  6.9 trillion tokens. The 1.2% tax rate is set to go until the total LUNC supply sits at 10 billion tokens. To obtain this goal, 99.82% needs to be taken out of circulation.

According to an analysis by a news media outlet, the Terra Classic foundation needs to reduce the LUNC supply down to 40 billion at a burn rate of 1.2% making sure the price is kept low and market volume maintained.

Based on the analysis, with an imaginable market cap of $40B, the asset may be able to hold the 1$ mark which will take a relative amount of 7 years. Although analysts like Michaël van de Poppe think that LUNC doesn’t stand a chance of hitting the $1 spot, it will be interesting to see how the network will continue to keep volume high while keeping the price low even as supply reduces.

According to LUNCBurn, an unofficial Twitter account that tracks down LUNC’s burn activity revealed that hours before the tax burn parameter went live, about 4.1 billion LUNC had been excluded from circulation.

At the same time, two more trading platforms committed to supporting the 1.2% tax burn but on two different ground terms. Crypto.com will charge only withdrawals and deposits while eToro will apply it to off-chain transactions.

At the time of writing, the token is currently exchanging hands  for $0.0002903, a 1.21% drop in the last 24 hours.

Do you think LUNC will be able to clinch the $1 price point within years to come? Share your views in the comment section.