Removal of Offchain to Onchain tax

Proposals
1

Objective

Remove the transaction tax on off-chain to on-chain transfers into Terra Classic (LUNC), while maintaining the tax on on-chain to off-chain transfers.

Rationale

The current inbound tax acts as a barrier to capital entry. Large investors (“whales”), funds, and external ecosystems are discouraged from bridging capital into LUNC when they are taxed before participating in the economy. Removing the inbound tax lowers friction, increases liquidity, and makes Terra Classic more competitive with other chains.

Key Benefits

  • Encourages large capital inflows and whale participation

  • Increases DEX liquidity, volume, and price discovery

  • Boosts ecosystem activity (staking, swaps, dApps, DAOs, Forex)

  • Aligns Terra Classic with industry norms (no entry tax, exit tax preserved)

Tax Integrity Maintained

  • The outbound tax remains unchanged, ensuring continued burn pressure and value capture when capital exits the chain.

  • This creates a one-way incentive: easy to enter, costly to leave — encouraging long-term participation.

Conclusion

Removing the inbound transfer tax strengthens Terra Classic’s growth strategy without sacrificing its deflationary mechanics. It is a pro-liquidity, pro-growth adjustment designed to attract serious capital while preserving the ecosystem’s long-term economic health.

By: LUNC Cookie DO, Luncverse Validator Nicolas Boulay

2

This sounds like it would require maintaining an allow-list of CEX withdrawal wallets to identify “off-chain → on-chain” transfers.

That list will inevitably change (wallet rotation, custody providers, new hot wallets, new exchanges, etc.). Who is going to maintain it, and on what basis?

In practice you either:

(a) depend on exchanges to regularly coordinate with the chain, or
(b) create an internal process/committee to curate and update the list.

Neither option feels consistent with the direction we keep claiming we want - minimizing single points of power/failure and governance overhead.

Instead of continuously tweaking the tax mechanics and adding exceptions, I would rather see proposals that grow real on-chain demand (products, dApps, liquidity incentives that make sense, integrations) so the chain can ultimately justify lowering or removing the burn tax entirely, rather than turning tax policy into an ongoing operational maintenance burden.

1 Like
3

Thats why we created and passed the forex proposal but the only way we can scale this to unbelievable heights is being able to have whale come onchain. Instead of making it complicated all we do is whitelist all onchain transfers and problem solved. No whale will transfer 1 million $ if they have to pay 0.5% just to bring their lunc over. So its like the chicken before the egg or the egg before the chicken, we have plenty dapps and utilities onchain we just need new money to come in.