- Terra Classicโs 13% monthly run kept LUNC above a $500M market cap.
- Developers discontinued โTax2Gasโ and switched to a simplified tax system.
- Canceling receiving taxes, Terra Luna Classic expands dApp compatibility.
The Web3 developer company Orbit Labs is taking a historical leap forward in enhancing Terra Luna Classicโs (LUNC) infrastructure. A few days back, the original chain’s community approved the proposal, dubbed #12143 ‘Reverse Charge’, authorizing the dev team to take the reigns and buckle down.
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This upgrade includes a simplified tax mechanism on LUNC, offering automatic tax deductions with backward compatibility.
What Reverse Charge Tax Brings for LUNC
The new tax system on Terra Classicโs L1 chain will replace the previous โTax2Gasโ consensus, eliminating the previous requirement for the payment sender to pay the transfer tax as an extra fee. This outdated logic has imposed multiple challenges on developing decentralized applications on the network, particularly those native to other blockchains.
According to the updates on Orbit Labsโ official X account, the work on implementing this on a Pay-per-Job (PPJ) basis, focusing on fixing interchain tests introduced in SDK 0.47, as well as carrying out a comprehensive code overview of the community-approved โReverse Chargeโ mechanism. Overall, the developers at Orbit Labs set a $2,500 budget for this work to be done.
Terra Luna Classicโs $1 Dream Put on Hold?
Despite the favorable L2 network developments, Terra Luna Classicโs price value has been lagging, with a slight increase of 2.2% over the past 24 hours. While keeping above a $500 million market cap, the altcoin competition has been fierce for LUNC, as the altcoin continues to dwell below cryptoโs TOP 150 by global market capitalization.
On the technical side, Terra Luna Classicโs price charts show more bearish signs than bullish ones. On the one-day charts, the Layer-1 altcoin continues to trade below the key support of $0.0000950. At the same time, the Stochastic Relative Strength Index (StochRSI) flashes an overbought condition for LUNC, floating between 86 and 80.
The Chaikin Money Flow (CMF) also dwelled below zero, signaling that more large investors are distributing their LUNC positions rather than accumulating, making the $1 LUNC price target unrealistic for the time being. Nevertheless, the forthcoming price trajectory for Terra Luna Classic heavily depends on the usage, as traders on the receiving side on Terra Classicโs chain wonโt be taxed on incoming transfers when the upgrade kicks in.
On the Flipside
- Contrary to most previous volunteer developer teams on LUNC chain, Orbit Labs is not anonymous – the devs have underwent KYC, certified by SolidProof.io.
- Part of the Terra Luna Classic community backs โTax2Gasโ, arguing that the new LUNC taxation model will significantly reduce tax and burn revenue.
Why This Matters
Such technical tweaks can boost the blockchainโs adoption as traders seek efficient ways to move money on-chain within a coherent taxation system.
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