Terra Receives Permission From Bankruptcy Court To Reopen Shuttle Bridge And Burn 150M LUNA Tokens
In Brief
Terra announced that it secured permission to reopen Shuttle bridge for redeeming wrapped assets on Terra Classic and burn 150 million LUNA.
Cosmos-based blockchain protocol Terra announced that the bankruptcy court has issued an order in TFL’s Chapter 11 case, permitting TFL to reopen the Shuttle bridge for redeeming wrapped assets on Terra Classic. Additionally, the court has authorized TFL to undelegate and burn the 150 million LUNA tokens received from the Terra Community Grant.
According to an announcement on the social media platform X, TFL plans to transfer all assets from the Shuttle bridge wallets to new, more secure wallets under the court order. Additionally, a new, simplified Shuttle bridge interface will be made available, allowing users to redeem wrapped assets from the bridge wallets for up to 30 days after TFL’s Chapter 11 plan becomes effective.
After this period, TFL will permanently close the Shuttle bridge and any remaining assets will be burned. However, the court has not yet approved TFL’s proposed Chapter 11 plan, which is not expected to take effect until at least late September 2024.
Terra To Begin Undelegation Of 125M LUNA Tokens Staked In Validators
Furthermore, under the bankruptcy court order and in accordance with the settlement between TFL and the Securities and Exchange Commission (SEC), TFL will initiate the undelegation process for the 125 million LUNA tokens currently staked with 49 validators recommended by the Terra Delegation Committee. After the undelegation is complete, both the 125 million LUNA tokens used for delegations and the 25 million LUNA allocated for liquidity provisioning will be burned.
Terra stated that users do not need to take any action at this time. The company will provide instructions on the steps previous users of the Shuttle bridge should follow in the future.
Founded in 2018, Terraform Labs is an open-source software development company focused on blockchain technology. The company previously developed the algorithmic stablecoin TerraUSD and the cryptocurrency Luna, both of which experienced a collapse in 2022.
Terraform Labs filed for Chapter 11 bankruptcy with the Bankruptcy Court for the District of Delaware earlier this year. This filing allows the company to maintain operational continuity during the proceedings. In May, Terraform Labs and its co-founder, Do Kwon, reached a “settlement in principle” with the SEC.
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About The Author
Alisa, a dedicated journalist at the MPost, specializes in cryptocurrency, zero-knowledge proofs, investments, and the expansive realm of Web3. With a keen eye for emerging trends and technologies, she delivers comprehensive coverage to inform and engage readers in the ever-evolving landscape of digital finance.
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Alisa, a dedicated journalist at the MPost, specializes in cryptocurrency, zero-knowledge proofs, investments, and the expansive realm of Web3. With a keen eye for emerging trends and technologies, she delivers comprehensive coverage to inform and engage readers in the ever-evolving landscape of digital finance.
