Luna Foundation Guard Steps Up to Protect UST’s Bitcoin Peg

0
12

The Luna Foundation Guard has once again come forward announcing some key measures to safeguard the Bitcoin peg for its native UST stablecoin.

Last weekend turned out to be a major nightmare for Terra (LUNA) investors and all participants of the ecosystems. In what seemed like a coordinated attack on the Terra-Luna-UST ecosystem a single player dumped a massive 285m UST resulting in massive shorts on LUNA.

As a result, the circulating supply of LUNA jumped by nearly 1 million in a single day reaching 91.357 million. Thus, the LUNA price collapsed by nearly 20% moving under $60. However, it has partially recovered and is currently trading at $63.54.

In its recent post, the Luna Foundation Guard writes that the macro conditions have resulted in major price volatility and thus, it becomes prudent to prepare for potential future volatility.

Luna Foundation Guard Taking Some Key Measures

To protect the UST peg, the LFG Council has voted to execute some key measures. It includes:

  1. Loan $750M worth of BTC to OTC trading firms to help protect the UST peg.
  2. Loan 750M UST to accumulate BTC as market conditions normalize.

LFG notes that the traders will trade the capital on both sides of the market to accomplish the above two points. This will help to maintain the parity of LFG’s Bitcoin reserve pool as the market conditions continue to stabilize. The Lunda Foundation Guard explains:

Per the LFG’s mandate, the LFG will proactively defend the stability of the $UST peg & broader Terra economy, especially under volatility and the uncertainty of macro conditions in legacy markets.

Terraform Labs has pledged to acquire $10 billion worth of Bitcoins as a reserve for its UST stablecoin. Last week, it acquired an additional $1.5 billion worth of Bitcoins. So far Terraform Labs has acquired $3.5 billion BTC.

It plans to complete the $10 billion BTC acquisition by the end of the third quarter of 2022. Despite Sunday’s attack, the UST stablecoin continues to maintain its position among the top ten cryptocurrencies.

Bhushan is a FinTech enthusiast and holds a good flair in understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In free time he reads thriller fictions novels and sometimes explore his culinary skills.

The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.

bitcoin news india, bitcoin current price in india, bitcoin binance, bitcoin buy india

Source link

LEAVE A REPLY

Please enter your comment!
Please enter your name here