Terra LUNA 2.0 (LUNA2) is a response to the Terra UST stablecoin collapse, introduced as a measure to recover from the event. Developed by Do Kwon and the team, LUNA2 is part of a strategy that splits the original Terra project into Terra LUNA 2.0 and LUNA Classic (LUNC), aiming to establish a new ecosystem. Launched in 2022, LUNA2 represents an effort to restore the functionality of Terra's blockchain technology.
The system relies on a Proof of Stake consensus mechanism, supported by 130 validators. These validators participate in governance through a delegated voting system, influencing the direction of the network. The economic model of LUNA2 includes gas fees and a 7% annual inflation rate, intended to motivate engagement and maintain network security.
Existing token holders were granted LUNA2 tokens, a move designed to mitigate the impact of prior losses and promote community engagement. This distribution reflects an attempt to balance equity and encourage user investment in the network's future.
The Terra ecosystem supports various forms of interaction, including DeFi activities, governance participation, and software development. It offers opportunities for both developers and users to engage with and contribute to its growth. Staking and validation processes are central to network security and highlight the cooperative approach Terra seeks to foster.
