Kraken wants you to be aware of certain fees that will result from proposals 3568 and 4159. These proposals will introduce a 1.2% tax burn for on-chain transactions of Terra Classic (LUNA) and TerraUSD Classic (UST) on the Terra Classic network:
- Deposits: Transactions will be taxed by the Terra Classic network before they reach Kraken. When depositing LUNA or UST on Kraken, the deposit transaction must include the 1.2% tax in its transaction fee, as well as a sweep fee that will be deducted off the deposited amount by Kraken (1.2%).
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- Why the sweep fee? When deposits arrive in Kraken’s wallet, those funds need to be swept into our hot wallet. This transaction happens on-chain and is subject to the tax burn.
- Withdrawals: When moving LUNA or UST off Kraken, transactions will be taxed by the Terra Classic network before they reach your external address. The balance will be credited to your external wallet, minus the 1.2% tax deduction by the network.
Changes are expected to go live after the proposals are submitted. Current projection is 2022-09-21 06:00 UTC, at the Terra Classic block height of 9,475,200. Spot, margin, and futures trading will not be affected by this tax burn.