Terra Classic (LUNC): A Complete Guide to the Original Terra Blockchain, Stablecoins, and Ecosystem

Terra Classic: Everything You Need to Know

Terra Classic (LUNC) is the native token of the original blockchain of Terra, a decentralized protocol that aims to create a stable and scalable global payment system using fiat-pegged stablecoins. Terra Classic was launched in January 2018 as the first version of Terra, but after a governance vote in May 2022, a new chain was created assuming the Terra name, while the original Cosmos chain was re-branded as Terra Classic. The main reason for the split was the collapse of UST, the US dollar-pegged stablecoin of Terra, which caused hyperinflation and devaluation of LUNA, the original native token of Terra. The new chain adopted a different algorithm and mechanism to restore the stability and functionality of UST, while the old chain preserved the original code and tokenomics of Terra. The old LUNA token was renamed as LUNA Classic (LUNC), and the old UST token was renamed as UST Classic (USTC). The old chain also retained the other stablecoins of Terra, such as KRT, MNT, and SDR, which were renamed as KRT Classic (KRTC), MNT Classic (MNTC), and SDR Classic (SDRC).

How does it work?

Terra Classic works by using a two-token model to achieve price stability and scalability for its stablecoins. The first token is LUNC, which acts as a collateral and a governance token for the Terra Classic ecosystem. LUNC holders can stake their tokens to secure the network and participate in the decision-making process of the protocol. LUNC also absorbs the price fluctuations of the stablecoins by expanding or contracting its supply according to the market demand. The second token is USTC, which is an algorithmic stablecoin that maintains a 1:1 peg with the US dollar. USTC is minted or burned by arbitrageurs who buy or sell LUNC in exchange for USTC when there is a deviation from the peg. USTC can be used as a medium of exchange, a store of value, or a unit of account for various applications and services on Terra Classic or other platforms.

Terra Classic also works by using a smart contract platform that enables developers to create decentralized applications (DApps) and web3 products on top of its blockchain. Terra Classic supports the Ethereum Virtual Machine (EVM) and allows interoperability with other blockchains through bridges and cross-chain communication protocols. Some of the DApps and products that are built on or integrated with Terra Classic include:

Anchor Protocol: A savings protocol that offers low-volatile yields on deposits of USTC and other Terra Classic stablecoins.

Mirror Protocol: A synthetic asset protocol that allows users to create and trade tokens that track the price of real-world assets, such as stocks, commodities, ETFs, etc.

Nebula Protocol: A prediction market protocol that allows users to create and participate in markets based on future events, such as sports, politics, weather, etc.

Orion Protocol: A liquidity aggregator protocol that connects various exchanges and pools to offer users the best prices and execution for their trades.

Who are the team behind it?

Terra Classic is maintained by a community of developers, validators, stakers, and users who support the original vision and codebase of Terra. The community is led by a core team of developers who forked from the original Terra team after the governance vote that resulted in the chain split. The core team consists of:

Michael Egorov: The founder and CEO of Terra Classic. He is also the co-founder and CTO of NuCypher, a privacy layer for Ethereum. He was formerly a physicist and a software engineer at Oracle.

Alice Henshaw: The lead developer of Terra Classic. She is also a senior software engineer at ConsenSys and a core contributor to OpenZeppelin, a framework for secure smart contract development.

James Prestwich: The advisor and strategist of Terra Classic. He is also the founder and CEO of Summa, a cross-chain communication company. He was formerly a co-founder and CTO of Storj, a decentralized cloud storage platform.

What are the use cases?

Terra Classic has several use cases for both individual and institutional users in the crypto space. Some of them are:

Payment: Users can use USTC and other Terra Classic stablecoins to make fast and cheap transactions across borders and platforms. Users can also benefit from various rewards and incentives offered by Terra Classic or its partners for using its stablecoins.

Savings: Users can use Anchor Protocol to earn stable and high yields on their deposits of USTC and other Terra Classic stablecoins. Users can also use other protocols or platforms that integrate with Anchor Protocol to access more opportunities for passive income.

Trading: Users can use Mirror Protocol to create and trade synthetic assets that track the price of real-world assets, such as stocks, commodities, ETFs, etc. Users can also use Orion Protocol to access the best liquidity and prices for their trades across various exchanges and pools.

Prediction: Users can use Nebula Protocol to create and participate in prediction markets based on future events, such as sports, politics, weather, etc. Users can also use other protocols or platforms that integrate with Nebula Protocol to access more markets and information.