Fun

Terraform Labs Donates 12 Million LUNA to Luna Foundation Guard

News Feed - 2022-03-12 06:03:18

Terraform Labs Donates 12 Million LUNA to Luna Foundation Guard


Terraform Labs, the company behind the creation of Terra, has announced a new donation to support the ecosystem of the terra (LUNA) token. Do Kwon, CEO of Terraform Labs, announced that the company has donated 12 million LUNA (approximately $1.2 billion) to the Luna Foundation Guard (LFG) with the goal of continuing to grow its decentralized forex reserve to intervene during stressful market conditions if necessary. Terraform Labs Fills LFG Vaults


Terraform Labs, creator of the terra token, is putting funds toward supporting the growth of its flagship stablecoin, UST. The company announced a new donation of 12 million LUNA to the Luna Foundation Guard, another decentralized organization, that will be directed to grow the stabilization fund to maintain the UST dollar peg.


Do Kwon, CEO of Terraform Labs, explained on Twitter that these funds will be used to be burn and mint $UST, which then will be used to grow the reserves of the Luna Foundation Guard. The Luna Foundation Guard has been acting directly to bring more UST to secondary markets, which have become unbalanced due to the high demand the stablecoin is experiencing now.


In fact, just this month, the foundation has already acted twice to replenish the supply of UST in the pools of Curve, a decentralized exchange with low slippage for stablecoin trades. The UST Depeg Dilemma


The purpose of all of these actions is to increase user trust when it comes to the stability of UST and its peg to the U.S. dollar. While other stablecoins manage to maintain this peg using various systems, UST relies on the relation it has with its sister token of the Terra ecosystem, LUNA, and the arbitrage opportunities that the treasury offers to traders.


However, some analysts have stated that these mechanisms embedded into the protocol can fail, producing an imbalance that could cause UST to lose its intended peg. Kwon was emphatic about the objective of the donation made, stating:


If there is any confusion left at this point, we will keep growing reserves until it becomes mathematically impossible for idiots to claim depeg risk for UST.


Kwon has also been adamant about the importance of these reserves being stored in the form of BTC, an asset that is external to Terra, but that according to him, “thrives in chaos.” Tags in this story BTC, depeg, do kwon, luna foundation guard, terraform labs, UST, vaults


What do you think about the 12 million LUNA donation from Terraform Labs to the Luna Foundation Guard? Tell us in the comments section below. Sergio Goschenko


Sergio is a cryptocurrency journalist based in Venezuela. He describes himself as late to the game, entering the cryptosphere when the price rise happened during December 2017. Having a computer engineering background, living in Venezuela, and being impacted by the cryptocurrency boom at a social level, he offers a different point of view about crypto success and how it helps the unbanked and underserved. Yuga Labs Obtains Cryptopunks and Meebits Brands, Gives Commercial Rights to NFT Holders NEWS | 5 hours ago Bitcoin Exchange Reserves Drop to Lowest Point in 3 Years NEWS | 9 hours ago


Image Credits: Shutterstock, Pixabay, Wiki Commons Previous articleZapala Free Zone to Offer New Opportunities to Bitcoin Miners in Argentina Next articleWestern Union Suspends Operations in Russia, Belarus Over Ukraine War Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article. Read disclaimerShow comments More Popular NewsIn Case You Missed ItVenezuela Might Be Affected by Russian Banks" SWIFT Suspension


Analysts from Venezuela have expressed their worries about the expulsion of a number of Russian banks from SWIFT, an international messaging system that allows the interconnection of banks. These measures could affect the finances not only of Venezuela, but also ... read more.While the Fed Monitors the "Ukraine Situation Closely," Powell Still Expects a Series of Quarter-Point Rate Hikes Rwanda May Not Reach Decision on CBDC Issuance Until End of 2022 — Central Bank Official Proof-of-Work Ban Removed From Europe’s Proposed Crypto Regulation UK Regulator Bans Floki Inu Ad for Being Irresponsible, Exploiting Investor FOMO

News Feed

Turner Wright2 hours agoPro-crypto lawmaker stays interim US House Speaker as frontrunner loses first round of votingOhio Representative Jim Jordan, the Republican Party"s nominee for Speaker, won the support of 200 of h
Hong Kong issues generative AI guidelines for consumer protection
Arijit Sarkar46 minutes agoHong Kong issues generative AI guidelines for consumer protectionThe HKMA introduces new principles for using generative AI, emphasizing governance, transparency, and data protection in consume
Dragon Age Lead Producer Out as EA's BioWare Keeps Bleeding
TwitterFacebookLinkedInBioWare suffered another blow with the departure of its next big title"s lead producer, Fernando Melo. Maybe they should part ways with EA. | Photo by Matt Sayles/Invision for Microsoft/AP Images
Mad Money’s Jim Cramer Wants Crypto Investors to Bet Against Him — ‘I Have Done This for 42 Years’
Mad Money"s Jim Cramer Wants Crypto Investors to Bet Against Him — "I Have Done This for 42 Years" The host of Mad Money, Jim Cramer, has challenged crypto investors to bet again
Stellar’s Foundation Just Destroyed Half the Supply of Its Lumens Cryptocurrency
MEXICO CITY – The Stellar Development Foundation has burned 55 billion of its XLM tokens, over half the cryptocurrency’s supply, CEO Denelle Dixon announced from the stage of the Stellar Meridian conference Monda
New Zealand VC Launches $5 Million Web3 and Crypto-Focused Fund
New Zealand VC Launches $5 Million Web3 and Crypto-Focused Fund New Zealand-based venture capital firm Global From Day 1 (GD1) recently said it had launched a $5 million Web3 and c
TON’s $5M incentive program aims to drive digital ID verification
Gareth Jenkinson14 hours agoTON’s $5M incentive program aims to drive digital ID verificationTON Society is offering one million Toncoin tokens to users who verify their identity using palm scanning technology.3857 Tot
David Attlee44 minutes agoBill to exempt foreigners from crypto taxes passes preliminary reading in IsraelThe bill would also level up crypto bonuses with employee stock options by reducing the current 50% tax to 25%.400
Nigerian blockchain group calls for fair resolution in Binance case
Amaka Nwaokocha1 hour agoNigerian blockchain group calls for fair resolution in Binance caseBICCoN believes that a balanced approach can help resolve the current challenges and empower Nigeria to create a supportive envi
Marcel Pechman4 hours agoUS gov’t debt downgraded — Huge news for Bitcoin?Cointelegraph analyst and writer Marcel Pechman explains why the downgrading of U.S. government debt will negatively impact the price of Bitco
BlackRock Bitcoin ETF posts September's biggest daily inflow of over $180M
Ciaran Lyons12 hours agoBlackRock Bitcoin ETF posts September"s biggest daily inflow of over $180MBlackRock"s Bitcoin ETF saw the highest daily inflow of any fund this month on Sept. 25, amid a wider five-day inflow stre
Pakistani Politician Imran Khan’s Instagram Account Used to Promote Crypto Giveaway Scam
Pakistani Politician Imran Khan"s Instagram Account Used to Promote Crypto Giveaway Scam Imran Khan, a former prime minister of Pakistan and current chairman of one of the largest