Abstract
Terra (LUNA) is a decentralized blockchain network that launched in the aftermath of the market collapse of the original Terra ecosystem in early May 2022. The new Terra chain features no TerraUSD (UST) algorithmic stablecoin or any other decentralized stable digital currency, which was a major component of the old Terra chain–now named Terra Classic (LUNC)– and its most significant design vulnerability. The new Terra chain–also referred to as Terra 2.0–features most DeFi applications and tools of the old chain; Terra Station, Terra Finder, and Terra Observer all migrated to the new chain and launched with full functionality with the Genesis block on May 28, 2022. Other popular decentralized applications–like Astroport, Prism, RandomEarth, Spectrum, and Nebula–also migrated to the new chain, along with the old validator set. Terra 2.0’s LUNA tokens were airdropped to owners of old LUNA (now named Luna Classic, or LUNC), UST, and aUST (UST deposited in Anchor Protocol) token owners. Like its predecessor, Terra 2.0 uses the Proof-of-Stake (PoS) algorithm to reach a consensus about the state of the distributed ledger. LUNA owners can stake their tokens to become network validators and participate in the process of community governance and securing the network in exchange for LUNA staking rewards.