1/9 $LUNA at $8.50. Not too surprising.

LUNA is valuable because it controls the Terra 2 network via governance.

Governance in Terra 2 is actually democratic. No single entity owns a majority of the LUNA, so it makes sense to accumulate LUNA for governance. 🧵

2/9 Most notable thing Terra 2 governance controls is the community pool. At 200MM LUNA, it's already worth more than a billion dollars.

It's reasonable to assume rival entities have their eye on Terra 2, and would like to control it. But to do so they need to buy LUNA.

3/9 For Terra 1, it didn't make sense to accumulate LUNA for governance, as TFL owned 50% of supply and almost always got what they wanted.

Same with AVAX, SOL, etc. Those networks are not democratic. Voting is pointless, as supply is extremely concentrated in few hands.

4/9 With Terra 2, supply is widely distributed, not concentrated. So voting actually means something.

For the first time ever on an alternative smart contract platform it makes sense for entities to accumulate the native asset for the purpose of governance.

5/9 If the powers that controlled Terra 1 want to have the same control over Terra 2, they will have to accumulate significant amounts of new LUNA that was airdropped to retail.

What can you do if you control the network?

1/8 Terra 2 airdrop on May 27th. 70% for community airdrop. 30% for comm fund.

Terra 2 = community + decentralization.

How much LUNA will there be at genesis? What will the price be? How much will be dumped? What about the VCs from Terra 1?

Let's talk airdrop allocation. 🧵👇

2/8 First of all, when you receive your airdrop it will be in a bonded state, i.e. it will be staked.

To transfer it you will have to unbond, which takes 21 days.

So for the first 21 days, the only liquid LUNA on the market will be the 5MM from the developer allocation.

3/8 How much supply will hit the market 21 days after launch?

Here's a key piece of info:

For pre-attack LUNA, only addresses that had less than 10K LUNA will get the genesis unlock. That means only 6.45% of LUNA pre-attack is eligible for the genesis unlock.

That means...

4/8 Genesis unlock amounts per category:

pre-attack LUNA: ~6,811,200
pre-attack aUST: 30,000,000
post-attack LUNA: 30,000,000
post-attack UST: 45,000,000

Total genesis unlock: ~111,811,200 (12% of total supply).

(Total supply of new LUNA = 1 billion, by the way.)

5/8 What does this mean?

It means the VCs and whales, who had most of their wealth in LUNA with addresses that had more than 10K, will not get anything until their 1 year cliff hits.

Terra 2 will be 100% community built, owned, and used for the first year.