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LUNA becomes a meme coin! CZ: Terra fork is useless, where is the Bitcoin reserve?

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LUNA becomes a meme coin! CZ: Terra fork is useless, where is the Bitcoin reserve?

On the early morning of the 14th, Terra founder Do Kwon proposed the Terra ecosystem restructuring plan (review report: https://bityl.co/CCyz), which involves creating a forked chain and reallocating new tokens, resulting in a new LUNA token. The existing LUNA tokens being traded on the market will not be included in this restructuring.

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Binance founder Zhao Changpeng CZ stated: This is my personal opinion and not investment advice. Do Kwon's proposal won't work. A fork won't give any new value to the chain, and this proposal is unlikely to succeed. Besides, even if you snapshot, you can't stop people from continuing to trade on-chain and off-chain. "Where are the bitcoins used as reserves? Aren't they supposed to be used to buy back UST?"

CZ also said: "Do you really think forking the Bitcoin network snapshot on November 18, 2021, and forking Bitcoin will give the post-forked Bitcoin a value of 68,000 this year?"

Yesterday, Binance temporarily halted trading of UST and LUNA. After the Terra network was restored, trading resumed. Many people also made unexpected profits in a bear market due to LUNA becoming a meme coin, with its price skyrocketing more than tenfold overnight.

As of now, Do Kwon has not detailed the current disposition of the Bitcoin reserves.

However, many critics argue that the new chain will not have value and that these old transactions exist because exchanges like yours continue to offer trading of the old LUNA, believing CZ's actions and words are contradictory.

The Block research director Larry Cermak even suggested that CZ's keen interest in commenting on LUNA is because Binance led Terra's seed round in both 2019 and 2021, and even six months ago participated in a $300 million investment that was locked for four years and linearly unlocked for one year, with market maker Jump also involved.

However, CZ refuted this claim:

"Binance did not participate in the second round of LUNA financing, nor did we acquire any UST. Binance Labs had invested $3 million in Terra in 2018, and UST emerged long after that."

He stated that Binance Labs has invested in many companies over the past four years, including many competing exchanges and blockchains, some of which failed and some were very successful. He emphasized that transparency, swift handling, and communication with the community are crucial when issues arise. When a solution is found, Binance will strongly support the community.

On 5/16, LFG finally disclosed the use of funds. CZ also mentioned on 5/16 that Binance received 1.5 million LUNA from the $3 million invested in 2018, which at its peak was valued at $1.6 billion, resulting in a 560x return. However, they have not moved or sold it. CZ stated that they also support the proposal to compensate small holders with the remaining funds of the LFG Foundation.