On Wednesday, the number one crypto exchange Binance announced that it is altering the Terra Classic ($LUNC) burn tax from 1.2% to 0.2%. Earlier, the Terra LUNC community overwhelmingly passed Proposal 5234 to reduce the tax to 0.2%. The proposal also envisages setting aside 10% for the community pool to finance Terra Classic ecosystem development and contributors. Likewise, the consolidation charges of on-chain transactions, namely withdrawals and deposits on Binance, will also be slashed to 0.2%.
Binance Changes Terra Classic ($LUNC) Tax to 0.2%
Binance decision to slash the taxes to 0.2% was stated in an official announcement on October 19. Binance said it would update the burning tax on on-chain transactions, including deposits and withdrawals, from 1.2% to 0.2%. The changes will apply to the Terra Classic ($LUNC) and TerraClassicUSD (USTC) deposits and withdrawals. However, the revised rates will not be applicable for off-chain tax burn of trading fees on LUNC spot and margin trades.
Although Binance announced that it would reduce the 1.2% burn tax on LUNC and USTC deposits received to 0.2% may not happen on other crypto exchanges or platforms, and it could charge withdrawal fees as before.
As of now, users who withdraw the amount from the Binance crypto exchange will get the withdrawal amount after withdrawal fees charged by Binance and a 0.2% tax burn by Terra Classic ($LUNC) chain.
As already mentioned, the Terra Community had passed Proposal 5234 after Binance CEO “CZ” recommended reducing the fees to increase LUNC trading, which may increase the LUNC burn rate. The move was also supported by Terra Rebel developers Edward Kim and Alex Foreshaw. The Terra Classic Community also unveiled a proposal for the Terra Classic Grants Program to ensure the transparent and efficient use of funds in the community pool.