The New Rebirth of Terra

The Terra team shared three major changes to the previously published Terra revival and redistribution plan and launched a new network.

Do Kwon and the Terra team are actively fighting for the restoration of the ecosystem and are trying to normalize the work of TerraUSD and Luna in various ways. Almost every step of the restoration of ecosystem and new strategies are actively being discussed with the community on Twitter and other forums.

On May 20, a new post appeared on Terra’s Twitter:

We have published an amendment to Proposal 1623, incorporating the community’s feedback since its publication 2 days ago. Please see below for details.

This message announced three points that should make the previous plan for the revival of Terra effective:

• Increase in initial liquidity;
• Introduction of a new liquidity profile for LUNA holders;
• Reduction of distribution among UST holders.
• In the new plan, the parameters of the initial liquidity of Anchor UST (ust) holders before the attack, LUNA holders after the attack and UST holders after the attack have been changed. The change will be from 15% to 30%. The Terra team expects that this will help “mitigate future inflationary pressures” and increase the token supply during the launch.

Despite the fact that there are theories about the attacks that led to the collapse of Terra, Nansen has published its investigation, which refutes the attack theory.

“Our on-chain investigation revealed that a small number of players identified vulnerabilities early into the UST de-peg, specifically in the relatively shallow liquidity of the Curve pools securing TerraUSD (UST)’s peg to other stablecoins” , writes Nansen.

The investigation says that vulnerabilities were used as follows:

• Withdrawing UST funds from the Anchor protocol on Terra
• Bridging these funds from Terra to Ethereum via the Wormhole infrastructure
• Swapping significant amounts of UST to other stablecoins in Curve’s liquidity pools, and
• During the de-pegging process, likely arbitraging inefficiencies between various pricing sources (Curve, decentralized exchanges, and centralized exchanges) by buying and selling positions between CEX and DEX markets.

Despite all the controversy, most of the community, namely 65.5%, supported Kwon’s plan. Also, 13.2% opposed, about 20% of respondents abstained from voting. On May 28, the Terra 2.0 Main Network (Phoenix-1) was launched in accordance with the plans of the Terra team and began producing blocks.