What happened
Terra Luna (CRYPTO:LUNA) tokens soared nearly 17% as of 11:10 a.m. ET on Tuesday on news that the decentralized financial institution Terra has passed its first proposition under new voting period parameters.
So what
Specifically, Terra Luna announced today that more than 92% of stakeholders participating voted in favor of a proposal to issue a “community grant” to pay a developer working under the handle Rebaz to “continue with a massive overhaul of [the] TrackTerra” tax and reporting application.
As the company explained in a tweet, this application will permit Terra transactions to be exported to “popular tax software,” easing reporting requirements as global governments establish new rules requiring that cryptocurrency income be reported to tax authorities for tax assessment.
Community Spend Proposal 147 to fund TrackTerra’s deployment as a tax and reporting app that exports Terra transactions to popular tax software has passed.
It’s the first prop to pass under the new minimum $LUNA deposit and reduced voting period params.https://t.co/8w2teXMTgO
— Terra (UST) 🌍 Powered by LUNA 🌕 (@terra_money) November 29, 2021
Rebaz will be paid a total of $42,680 in the form of 1,041 LUNA tokens for this work, which will take another one or two months to complete.
Image source: Getty Images.
Now what
Around the world, governments are hemming and hawing as they decide whether to regulate cryptocurrency transactions, or tax them, or both. With potentially billions of dollars in tax revenue at stake, my hunch is that they’ll ultimately find the money too great a temptation to resist.
That’s going to make tax reporting a bigger problem for cryptocurrency investors, and as Terra Luna notes in its report, there’s currently only “one competitor to trackterra which is stake.tax,” and “this solution is nearly unusable … doesn’t have support for many terra transactions [and] is also not opensource.”
For investors in stablecoins in particular, this suggests that Terra Luna has a product that will soon be in great demand — and that, in a nutshell, is why Terra Luna is going up today.
This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.