Terraform Labs (TFL), a Terra blockchain developer, has given the Luna Foundation Guard (LFG) 10 million LUNA, which is worth about $820 million at current pricing. In other words, LFG is a Terra-affiliated foundation entrusted with collateralizing Terra USD (UST), the network’s algorithmic stablecoin, in order to maintain it tied to the US dollar.
TFL’s latest announcement was made on Twitter on Thursday, but it did not specify what the money would be used for. However, Terra Finder transaction data shows that on Thursday, 7.8 million LUNA (approximately $630 million) were quickly transferred out of LFG’s reserve wallet.
Many believe that some of the cash will be used to develop Terra’s digital gold cache, which is led by creator Do Kwon, who has a goal of amassing $10 billion in Bitcoin (BTC) to support UST’s reserves. Another portion of LUNA could be burned (in order to keep the UST/USD peg).
TFL and LFG each bought $100 million worth of AVAX last week, so some more AVAX could be on the way. Following Terra’s recent (and ongoing) Bitcoin buying binge, which included the purchase of about 2,500 BTC (nearly $100 million) only two days ago, LFG’s wallet has surpassed MicroStrategy and Tesla as the world’s third-largest hodler of digital gold.
LFG’s overall reserve balance, according to its accounting records, is $2.44 billion at the time of writing, with BTC accounting for around 70% of that figure at $1.71 billion.
Despite all of Terra’s recent positive events, the price of LUNA has dropped 7% in the previous 30 days to $80.34 at the time of writing.
Read more: Do Kwon, Terraform Labs CEO, is bullish on LUNA
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