Community Owned DEX Discussion Gains Momentum in the Terra Classic Ecosystem
A new discussion within the Terra Classic community is gaining attention as members exchange views on the idea of a fully community owned decentralized exchange built around LUNC and USTC. The topic has already received multiple rounds of feedback from validators, developers, and community participants, showing growing interest in long term, utility focused infrastructure.
It is important to note that this is not a formal proposal. The concept is still at the discussion stage, where ideas, risks, and potential structures are being openly evaluated by the community.
At the center of the discussion is the idea of a community owned DEX with multiple utilities. One of the most discussed elements is the possibility of allocating 70 percent of trading fees toward buying back and burning USTC. Supporters see this as a volume driven and sustainable approach, while others emphasize the need for careful evaluation before any concrete steps are taken.
Overview of the Community Discussion
The discussion explores how a community owned DEX could function with full transparency, on chain fee distribution, and governance oversight. A key theme is the exclusive focus on LUNC and USTC to strengthen native utility and on chain demand within the Terra Classic ecosystem.
Another central point is the avoidance of inflationary incentives. Instead of minting new tokens or introducing emissions, all rewards and mechanisms discussed would rely solely on trading fees, preserving supply discipline.
Community members are currently weighing both the potential benefits and the risks to determine whether such an idea is viable, sustainable, and aligned with long term ecosystem goals.
Pros and Cons Being Discussed by the Community
| Aspect | Potential Strengths | Potential Risks |
|---|---|---|
| Utility and Burns | Trading activity could directly fund USTC buyback and burn, creating a transparent and sustainable deflation mechanism | Burn effectiveness would depend entirely on sustained trading volume |
| Token Supply Integrity | Fee funded incentives avoid inflation or dilution of LUNC and USTC | Incentives may be less competitive compared to emission based platforms |
| Community Ownership | On chain governance and verifiable fee flows could align incentives with the Terra Classic community | Decision making may be slower due to community driven governance processes |
| Native Asset Focus | Using only LUNC and USTC strengthens on chain demand and ecosystem utility | Limited asset support could restrict early liquidity depth |
| Technical Direction | Forking proven DEX architectures could reduce development risk | Custom changes still require audits, testing, and long term maintenance |
| Security Considerations | Transparent on chain logic improves trust and accountability | Multi chain or bridge features increase technical complexity and security exposure |
| Incentive Design | Multipliers, parking options, and referrals could encourage long term participation | Complex mechanics may increase user friction if not clearly designed |
| Community Pool Exposure | Strategic use of community resources could generate long term value | Slow adoption may delay recovery or justification of initial spending |
Key Discussion Points Moving Forward
Community feedback shows that while the idea has strong conceptual appeal, many members emphasize the importance of cautious evaluation. Areas such as liquidity bootstrapping, security architecture, user experience, and realistic adoption timelines remain open topics.
Transparency, incremental development, and continued open discussion are widely seen as essential before any transition from idea to implementation is considered.
Conclusion
The community owned DEX discussion reflects an ongoing effort within the Terra Classic ecosystem to explore sustainable, utility driven solutions. While the concept offers potential benefits such as fee based USTC burns and stronger native asset usage, it also introduces meaningful risks that require careful consideration.
As the discussion continues, community feedback will play a critical role in shaping whether this idea evolves further or remains a conceptual exploration.
