Luna Foundation Guard raises $1 billion to bolster UST stability

The non-profit Luna Foundation Guard (LFG) has raised $1 billion in a private sale of the LUNA token to a number of investors.

1/ The long awaited [REDACTED] 💎3 is here!

📣 The Luna Foundation Guard (LFG) has closed a $1 billion private token sale to establish a decentralized $UST Forex Reserve denominated in $BTC! 📣

🧵👇

— Terra (UST) 🌍 Powered by LUNA 🌕 (@terra_money) February 22, 2022

One of the largest token sales in the history of the industry was led by Jump Crypto and Three Arrows Capital. It also saw participation from DeFiance Capital, Republic Capital, GSR, Tribe Capital, and many others.

2/ The $1B private token sale by LFG is one of the cryptocurrency industry’s largest sales to-date.

The sale was led by Jump Crypto & Three Arrows Capital, with participation from DeFiance Capital, Republic Capital, GSR, Tribe Capital, & many others.

— Terra (UST) 🌍 Powered by LUNA 🌕 (@terra_money) February 22, 2022

The funds raised will be deployed into the UST Forex Reserve, an initiative aimed at maintaining the stability of UST — a key element of the Terra ecosystem.

“The UST Forex Reserve is an initiative by LFG designed to provide an additional level of support for UST using assets such as Bitcoin, which are less correlated with the Terra ecosystem,” the organisation’s representatives explained.

The reserve is intended to serve as a “release valve” for the algorithmic stablecoin during periods of sharp declines in the cryptocurrency markets.

“Reserve assets can be used when prolonged sell-offs deprive buyers of incentives to restore the UST peg and to arbitrage on Terra’s open market,” the developers explained.

According to them, the fund will initially include the first cryptocurrency, with other assets to be added later.

The LUNA tokens purchased by investors will be unlocked progressively over four years.

Luna Foundation Guard was created in January. The organisation focuses on developing the Terra ecosystem and increasing the resilience of the UST stablecoin.

LFG is overseen by an independent board of governors, comprising industry experts and heads of crypto firms, including Terraform Labs chief Do Kwon.

The organisation also provides grants to developers, researchers and community members.

As reported in December, the Terra displaced BNB Chain (formerly Binance Smart Chain) from the second spot on DeFi Llama’s rankings.

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