Binance CEO Changpeng Zhao Doubts Terra’s Plans for a Fork
Changpeng Zhao (CZ), CEO of Binance, has voiced his opinion on Terra’s proposal to fork its blockchain and attempt a recovery.
Following the collapse of both LUNA and UST, Terraform Labs founder Do Kwon endorsed the idea of forking Terra to “make the ecosystem whole from the UST depegging event.”
“We’ve built up one of the largest and most vibrant developer ecosystems in crypto, with some of the smartest minds in the world working on products with the best UI/UX,” Kwon said, while suggesting that the network be reset with a supply of 1 billion LUNA and a redistribution plan for LUNA holders, UST holders, and the community pool.
Some Terra community members are in agreeance to hard fork Terra to “TERRA2”, snapshot the holdings before the collapse, provide HODLers with a new coin (“LUNA2"), create a new chain with a new coin and version of UST, and then start a pool to repay the old UST peg.
Of the potential recovery plans, CZ said:
“Personal opinion. NFA.
This won't work.
- forking does not give the new fork any value. That's wishful thinking.
- one cannot void all transactions after an old snapshot, both on-chain and off-chain (exchanges).
Where is all the BTC that was supposed to be used as reserves?”
In another thread, CZ first denied rumours that Binance Labs had invested in UST, clarifying that in 2018, the exchange’s venture capital arm only invested $3 million USD into Terra.
He then gave some thoughts on Terra’s response to the debacle and the proposal of a fork.
“Minting, forking, don’t create value. Buying back, burning does, but requires funds. Funds that the project team may not have. In this regard, I would like to see more transparency from [Terra]. Much more! Including specific on-chain transactions (txids) of all the funds. Relying on 3rd party analysis is not sufficient or accurate. This is the first thing that should have happened…
I am not always right, but my perspective is: Failures can/will happen. But when they do, transparency, speedy communication and owning responsibility to the community is extremely important.”
I am just hoping that the project teams can rise from the ashes and rebuild in a proper and sensible way.”
Disclaimer: These are the writer’s opinions and should not be considered investment advice. Readers should do their own research.