Terraform Labs, Luna Foundation Guard Bought 3.06m AVAX in total: Avalanche Foundation

Mervyn Kwan   May 20, 2022 07:55

The Avalanche Foundation announced via Twitter on Friday that Terraform Labs and the Luna Foundation Guard (LFG) have purchased 3.06 million AVAX in total. - 2022-05-20T145503.939.jpg

The announcement came following an inquiry from members of the Avalanche Community about the details around the AVAX reserves held by Terraform Labs and the LFG.

The Terraform Labs' AVAX purchase comes with a one-year lockup and the amount represents around 0.5% of last week's AVAX volume.

While the LFG plans to use the AVAX for the Terra reserve pool and the purchased allocation represents around 0.9% of last week's AVAX volume.

The Twitter announcement also added that the LFG has not shared any plans on using the AVAX as it is working on a Terra chain fork.

“Given the proposed Terra chain fork, LFG has disclosed no plans to use the AVAX.”

The Avalanche Foundation also added that should any sales be contemplated for the LFG reserves; it is ready to work with LFG “on a sensible trading strategy.”

According to Bloomberg, LFG, which supports public blockchain Terra, chose Avalanche Foundation in April to diversify and expand its stablecoin reserve by acquiring  $100 million worth of AVAX from the Avalanche Foundation.

In the latest figure, the total reserve balance of the LFG remains over $232.7 million, and over 66% of the reserves are TerraUSD (UST), whereas AVAX takes nearly a quarter of its reserve, which takes around $58.83 million, trading at around $29.81.

Avalanche and Terra both are layer one blockchains, similar to Ethereum, where users can write codes and build different projects from non-fungible tokens to decentralized finance applications.

The Avalanche received $230 million in funding last September, pushing the price of AVAX to a record high of $68.89. However, subject to negative impacts from LUNA crashes, its price has dropped significantly.

Currently, AVAX was trading at $29.9 during the intraday, slightly up 1.53% on Friday in the Asia trading section.

Image source: Shutterstock

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