Terraform Labs has transferred an additional 10 million LUNA, worth about $880 million, to the non-profit Luna Foundation Guard (LFG). The funds could be used to invest in Bitcoin to bolster the stability of the algorithmic stablecoin Terra USD (UST).
TFL has gifted an additional 10 million $LUNA to the @LFG_org. https://t.co/tNirkgGGm0
— Terra (UST) 🌍 Powered by LUNA 🌕 (@terra_money) April 14, 2022
LFG was created in January 2022. Its aim is to develop the Terra ecosystem and increase the stability of UST. The organization is controlled by an independent board of governors, which includes industry experts and heads of cryptocurrency companies, including Terraform Labs founder Do Kwon.
In March, the Terra-backed company sent 12 million LUNA. In the same month, the organization began creating a fund, intended to provide the liquidity needed to support a stable UST price in Bitcoin.
He said that, once the process is completed, UST will become a ‘hybrid’ stablecoin, enabling direct purchases of BTC with a 1% premium.
As of writing, LFG’s balance sheet lists assets worth $2.43 billion. Of that, almost 70% ($1.7 billion) is held in Bitcoin. In addition, the organization’s reserve fund includes stablecoins USDC and USDT, as well as LUNA tokens.
According to BitInfoCharts, LFG has acquired over 42,406 BTC in total.
In April 2022, LFG and Terraform Labs announced that invest $200 million in AVAX tokens from the Avalanche project. The aim is to expand reserves and bolster the resilience of UST.