Changpeng “CZ” Zhao, CEO of crypto exchange Binance, recently questioned the idea of hard forking the Terra blockchain as a means to revive the once thriving Luna and UST ecosystems. Following the same, CZ revealed its perspective on the appropriate action for projects that have fallen in the crypto community.
“It will not work,” said CZ rejected the validators’ idea of hard forking for TERRA2, which would involve providing a new version of LUNA to all holders based on a snapshot of the holdings before the market collapse. CZ suggested:
“Supply should be lit, not forked out of date, and everyone trying to save the coin should be given up. I don’t even have any Luna or UST. Just commenting.”
Instead, he suggested that the Terra community should first use their bitcoin (BTC) reserves to buy back UST in order to revive their pegging.
1/8 These past weeks have proved to be a turning point for the crypto industry. We have seen a rapid decline in a large project that sent ripples across the industry, but a new found resilience in the market that was not present during the previous market downturn.
— CZ Binance (@cz_binance) 15 May 2022
Pointing out potential issues with forking Terra, CZ said that “casting, forking, doesn’t create value.” However, he recommends buying back and burning as some ideal means of reviving the coin’s market cap. Showing support for the Terra community, CZ highlighted the need for “more transparency from them.” And much more!”, which includes details about specific on-chain transactions (transaction IDs) of all funds:
“Failures can/will happen. But when they do, transparency, quick communication and taking responsibility to the community are extremely important.”
CZ further clarified that Binance had no active investments in Terra, nor did the company acquire any UST holdings, dismissing rumors circulating on Crypto Twitter about Binance’s interest in Terra:
“Binance Labs invested $3 million USD in Terra (Layer 0 Blockchain) in 2018. UST came much later than our initial investment.”
Binance Labs, the investment arm of Binance, has invested in a number of projects over the past four years that, according to CZ, have seen varying degrees of success and failure.
In the end, CZ hopes that Terra can rebuild itself “in a reasonable and sensible way”:
“Irrespective of my personal views or the solution chosen in the end, we will always be here to support the community.”
8/ I’m just hoping the project team can rise from the ashes and rebuild it in a proper and sensible way. Regardless of my personal views, or the solution chosen in the end, we will always be here to support the community in any way we can.
— CZ Binance (@cz_binance) 15 May 2022
related: BREAKING: Binance Suspends LUNA and UST Trading Amid Issues on Terra Blockchain
Binance was one of the early birds to suspend UST and LUNA trading on its platform as the Terra ecosystem began its death spiral.
As a result, Binance users were unable to find trading LUNA/BUSD and UST/BUSD pairs on May 12, a day after Terra blockchain validators were forced to take the network offline.
