Luna Foundation Guard will buy $100 million worth of AVAX
Luna Foundation Guard buys $100 million in Avalanche (AVAX) from the Avalanche foundation to augment its reserves.
1/ Thrilled to reveal the blossoming collaboration between @avalancheavax and Terra will also be further solidified with a $100 million Treasury Swap between TFL and the Avalanche Foundation of $LUNA <> $AVAX to strategically align ecosystem incentives!https://t.co/z9A86CWZDs
— Terra (UST) 🌍 Powered by LUNA 🌕 (@terra_money) April 7, 2022
Luna Foundation Guard buys $100 million in AVAX for stablecoin reserve
Luna Foundation Guard is a Singapore-based nonprofit building reserve for the stablecoin Terra (UST).
LFG bought $231 million in bitcoin a day earlier to increase its UST reserves, but this appears to be the first time LFG has bought into another cryptocurrency. With AVAX’s market share significantly smaller than Bitcoin’s, LFG is now a significant market buyer of AVAX.
“Welcoming $AVAX as the second major layer one crypto asset next to $BTC as part of the $UST Reserve,” LFG wrote. “The inclusion of @avalancheavax’s native token marks the start of a diverse pool of layer one crypto assets helping support the $UST peg.”
LFG plans to buy $3 billion worth of Bitcoin to keep in reserve to support UST, which has a market cap of around $16.7 billion and is the fourth-largest stablecoin. The Avalanche Foundation now holds $100 million worth of UST and $100 million worth of LUNA after the two deals.
LFG has been on a crypto buying spree of late, adding over $1.6 billion of Bitcoin to its treasury reserves to back Terra’s UST stablecoin. Last month, Terra co-founder Do Kwon pledged LFG would purchase up to $10 billion worth of bitcoin for its treasury. The Avalanche partnership marks the second layer one token LFG has added to its treasury.
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