Luna Foundation Guard Acquires an Additional $1.5B in Bitcoin

The Luna Foundation Guard (LFG), a nonprofit organization dedicated to the establishment of a true decentralized economy, has acquired an additional $1.5 billion in Bitcoin to bolster the reserves of its most popular stablecoin: U.S Terra (UST), according to an LFG tweet. 

The Singapore-based company acquired those additional 37,863 Bitcoins via over-the-counter (OTC) swaps with Genesis Trading and Three Arrows Capital (3AC). LFG traded $1 billion UST for Genesis Trading’s $1 billion in BTC, and bought $500 million worth of BTC from 3AC. An OTC swap is a financial contract that is arranged between two counterparties but with minimal intermediation or regulation. In other words it is a decentralized dealer market. 

UST also joined the top 10 cryptocurrencies in market cap, coming in at just over $18.6 billion, according to Bitpush terminal data. 

As it stands, the reserve has about $3.5 billion in Bitcoin. Do Kwon, co-founder and CEO of Terraform Labs, the group behind the Terra Blockchain, said he expects to reach the $10 billion goal by the end of the third quarter, according to a CNBC report. He believes acquiring this Bitcoin reserve “will open a new monetary era of the Bitcoin standard.” 

If Kwon expects the reserve to reach $10 billion by the third quarter, there will surely be many more announcements like this going forward. 

“For the first time, you’re starting to see a pegged currency that is attempting to observe the bitcoin standard,” Kwon said in the same CNBC report. “It’s making a strong directional bet that keeping a lot of those foreign reserves in the form of a digital native currency is going to be a winning recipe.”

“The jury’s still out on the effectiveness on the subject, but I think it is symbolic in the sense now that we live in a time where there’s excess money printing across the board and when monetary policies highly politicized that there are citizens that are self-organizing to try to bring systems back to a sounder paradigm of money,” Kwon added.

Author: Tyler Irvin

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