As the upcoming Terra Classic (LUNC) burning mechanism has gained more hype, some crypto exchanges thought it would be a good idea to show their support. However, the crypto community was quick to respond, calling out exchanges for what some see as public relations stunts.
September 1 Terra community member Edward Kim submitted a proposal to impose a 1.2% tax on every LUNC transaction on the chain in an attempt to revive the cryptocurrency. Tax on the transaction will be sent to the dead address, permanently removing part of the delivery cycle. After the proposal, LUNC token increased by 250%as the hype around the project showed signs of life.
For this reason, crypto exchanges KuCoin, Gate.io and MEXC Global have decided to express their support for the Terra community’s token burning efforts. However, some were unhappy with the announcements, sparking exchanges.
After sending the notification to express that the exchange supports token burning, KuCoin was called by the pseudonymous researcher Terra FatMan asking what they are doing to support it, given that tax burning is implemented on the chain. The researcher described the announcement as a “nicburger PR post” and suggested taxing actual stores instead.
How do you “support” anything here considering that the fuel tax will be imposed on the chain? You cannot opt out of it. Applies to all deposit and withdrawal transactions. Nicburger PR post. Taxing actual *trades* would be interesting, but no major exchange will ever do that.
— FatMan (@FatManTerra) September 7, 2022
Responding to the criticism, Johnny Lyu, CEO of the KuCoin exchange, told Cointelegraph that their trading platform is neutral and people-centric. “We always respect the choice of the communities and we are happy to help them as much as we can. The same applies to the tax proposal,” Lyu added.
Gate.io has also jumped into the fray as an exchange he announced that it will “implement the proposed chain burn at LUNC and USTC” once the proposal is approved. Then a community member called Gate.io, descriptive declaring it to be erroneous and misleading. User he argued that on-chain implementation does not fall under the jurisdiction of the exchanges and urged others to boycott the exchange and switch to other exchanges that actually support the growth of LUNC.
Unlike other exchanges that seemed to support word-only burning, MEXC Global held a limited time LUNC token burning event. Exchange committed burn spot trading fees for LUNC/USDT from September 3rd to September 17th. In May, MEXC supported the Terra burnout effort by performing monthly redemption and burning action to support the revival of LUNC. Despite its efforts, the exchange still hasn’t been able to dodge the crosshairs of a critic like one member of the community he demanded permanent burn from replacement.
Cointelegraph reached out to Gate.io and MEXC Global but did not receive a response.