- Terra Luna Classic (LUNC) has plunged 16% following a dispute among validators over alleged misuse of the Dynamic Commission mechanism.
- The controversy, coupled with a significant drop in trading volume, exacerbates the altcoin’s market struggles.
Terra Luna Classic (LUNC) is experiencing a turbulent phase as a conflict among chain validators threatens to escalate into a significant governance issue. Recently, BullBoss5, a prominent validator on the LUNC network, put forth a proposal addressing the alleged misuse of the Dynamic Commission mechanism by fellow validator JESUSisLORD.
The proposal on CommonWealth highlights concerns that JESUSisLORD has breached chain guidelines by operating a secondary validator node, JESUSisLORD 2. This move, according to the proposal, fragments voting power and is seen as an attempt to maintain lower commission rates through dual nodes. The proposed solution is a formal warning to JESUSisLORD, allowing time for correction without immediate punitive measures.
JESUSisLORD has responded with a statement on X, expressing intent to use all available legal avenues to defend his position and the interests of his delegates. The controversy adds to the mounting centralization concerns within the LUNC community, which fears that such practices could undermine the decentralization ethos of the chain.
Price Decline and Market Trends
The internal discord has coincided with a broader market downturn for Terra Luna Classic. Over the past week, LUNC has slipped by 13.6%, trading at $0.00007569, according to CoinGecko. This drop is more severe compared to Bitcoin’s 8% decline during the same period. The altcoin’s struggle is compounded by a dramatic reduction in trading volume, which currently stands at just $20,111,345—a stark contrast to the increased trading volume in derivatives, which rose by 72%.
Despite a bullish long versus short position ratio of 1.36:1, LUNC’s funding rates have remained negative since August 27. This suggests a market sentiment leaning towards skepticism regarding LUNC’s short-term prospects.
The Dynamic Commission rule, designed to address centralization by adjusting commission rates dynamically, is at the heart of the current dispute. While it does not explicitly forbid multiple validators under a single owner, it aims to prevent concentration of power that could undermine the network’s decentralized nature.
The conflict among Terra Luna Classic validators and the ensuing price decline reflect broader challenges faced by the altcoin. As the community navigates these issues, the resolution of the proposal and its impact on validator behavior and market sentiment will be crucial in determining LUNC’s future trajectory.
