Terra's LFG Reveals What Happened to Its Bitcoin Reserves

Key Takeaways

The Luna Basis Guard revealed Monday that it had spent virtually all of its Bitcoin reserves in its failed try to revive UST’s peg.
The LFG reportedly has solely 313 Bitcoin left, considerably down from the 80,394 it held earlier than UST and LUNA began crashing.
The LFG stated that it plans to make use of its remaining reserves, price round $81 million in complete, to compensate UST’s remaining customers, beginning with the smallest wallets.

The Luna Basis Guard revealed early Monday in a tweetstorm that it had bought off virtually its total Bitcoin reserve within the failed try to forestall the meltdown of its native governance token LUNA and flagship stablecoin UST.

LFG Says Its Bitcoin Reserves Are Gone

The Luna Basis Guard has lastly revealed what occurred to its $3 billion Bitcoin reserve.

The LFG, a nonprofit group tasked with defending the greenback peg of Terra’s UST stablecoin, reported early Monday in a tweetstorm that it had spent virtually all of its Bitcoin reserves in an try to guard UST’s peg. The Basis stated that on Could 7, or in the future earlier than UST started to de-peg from its focused $1 parity, it had 80,394 Bitcoin (its largest holding price round $3 billion on the time), together with roughly 26.2 million USDT, 23.5 million USDC, 1.9 million AVAX, 1.6 million LUNA, and 697,344 UST.

1/ As of Saturday, Could 7, 2022, the Luna Basis Guard held a reserve consisting of the next property:
· 80,394 $BTC
· 39,914 $BNB
· 26,281,671 $USDT
· 23,555,590 $USDC
· 1,973,554 $AVAX
· 697,344 $UST
· 1,691,261 $LUNA

— LFG | Luna Basis Guard (@LFG_org) May 16, 2022

After UST started de-pegging on Could 8, the LFG admitted to promoting all of its USDT and USDC reserves for an mixture of fifty,200,071 UST and transferred 52,189 Bitcoin to commerce with a counterparty for 1,515,689,462 UST. After its actions had didn’t stabilize the system, on Could 10, the LFG exchanged a further 33,206 Bitcoin for 1,164,018,521 UST in a last-ditch effort to defend the stablecoin’s peg.

In accordance with the Basis, this left it with solely 313 Bitcoin price round $9.2 million at present costs, about $11,7 million price of BNB, $63,29 million price of Avalanche, and an extra of LUNA and UST tokens price virtually nothing at present costs. In complete, LFG’s reserves are at present price round $81 million, considerably down from the $4.1 billion they have been price at their top on Could 3.

The LFG stated it was wanting to make use of its remaining property “to compensate remaining customers of $UST,” with the smallest holders being first in line. “We’re nonetheless debating by way of varied distribution strategies,” the Basis stated, asserting that updates would observe quickly.

The Monday report from LFG comes after the group got here beneath heavy hearth on Twitter for the opaqueness of the way it dealt with its reserves, with many within the crypto group questioning the place $3 billion price of Bitcoin went throughout Terra’s ecosystem-wide crash.

UST, which was already buying and selling for pennies on the greenback, has plummeted by round 15% on the information, whereas LUNA has dipped round 3.6% following the announcement whereas buying and selling 34% down on the day.

Disclosure: On the time of writing, the creator of this piece owned ETH and a number of other different cryptocurrencies.

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