Luna Foundation Guard Acquires $1.5 Billion in Bitcoin

Twitter icon  •  Published 1 year ago  •  Mark Weaden

The Luna network’s investment arm, the Luna Foundation Guard, has bolstered the reserves of its stablecoin U.S. Terra with $1.5 billion in Bitcoin (BTC)

The Luna network’s investment arm, the Luna Foundation Guard, has bolstered the reserves of its stablecoin U.S. Terra with $1.5 billion in Bitcoin (BTC). The investment is part of a long term goal of accumulating some $10 billion of bitcoin to back the U.S. stable coins. The decision to acquire Bitcoin now is well-timed, given we’re seeing the markets drop lower than we’ve seen since summer 2021. 

Luna Continues To Grow Its Reserves

The company is dedicated to growth, with Do Kwon, the cofounder and CEO of Terraform Labs, stating that he expects to reach the goal of accumulating $10 billion by the end of the third quarter this year. As it stands, the receive holds around $3.5 billion in bitcoin, as well as $100 million in an avalanche (AVAX).  

The latest acquisition was closed with a $1 billion purchase from leading broker Genesis, for $1 billion of UST, as well as $500 million of bitcoin from crypto hedge fund Three Arrows Capital.

Kwon had this to say regarding the acquisition: “For the first time, you’re starting to see a pegged currency that is attempting to observe the bitcoin standard,” and that “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 Market Is Shedding Value

So far, the month of May has been a turbulent one for the crypto market. The price of Bitcoin dropped 9.1% on Thursday, with the price of BTC as low as we’ve seen it since last July. It’s no coincidence that the drop in market value has coincided with Russia’s invasion of Ukraine, which has had a knock-on effect on various sectors of industry. 

Nonetheless, companies like Luna are driving forward with plans regardless of what the market is doing. The hope for decentralized companies like Luna is to bridge the gap between traditional finance and the crypto space. 

Talking on the issue, the head of derivatives at Genesis Global Trading had this to say “There’s traditionally been this gulf between where crypto native market participants are participating and Terra is on the far end of that, it’s designed by crypto-native people for crypto-native people.” 

The trade was mutually beneficial, as Genesis has strengthened its stable coin reserves. As part of the recent Luna deal, Genesis has set itself to be one of the largest wholesale lending businesses in crypto.

Author

Mark Weaden

Mark Weaden is a British researcher and crypto enthusiast, living in Barcelona. His work has been published on a variety of leading cryptocurrency sites.