Luna Foundation Guard (LFG), a non-profit organization formed to support the growth of the Terra ecosystem, has yet to answer a crucial question about

Over $1.2 billion in bitcoin reserves remains unaccounted for by Luna Foundation Guard

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2022-05-14 03:00:03

Luna Foundation Guard (LFG), a non-profit organization formed to support the growth of the Terra ecosystem, has yet to answer a crucial question about its bitcoin reserves after Terra's collapse.

LFG  accumulated  a total of 70,736 bitcoins (worth over $2 billion) as "forex reserve" for Terra's algorithmic stablecoin UST, which has recently severely  depegged and created havoc in the crypto market. 

While LFG acquired those bitcoins to save UST, it couldn't. UST, supposed to be worth $1 at all times being a stablecoin, has lost almost all of its value. It is currently worth roughly $0.12.

In the end, LFG's bitcoin reserves failed to shore up UST's peg against the dollar. Out of the total bitcoin reserves, LFG recently provided  a "loan" of $750 million in bitcoin to over-the-counter trading firms and market makers "to help protect the UST peg."

That means LFG should still have over $1.2 billion worth of bitcoin in its reserves. But thus far, the organization has not provided any details on those funds.

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