- Terra buys another $176 million in Bitcoin, 4 days after its 5,040 BTC purchase on April 6.
- LFG now carries a total of 39,897.98 BTC ($1.7 billion) Bitcoin.
- TerraUSD stablecoin will be backed by both their native LUNA token and Bitcoin.
A Singapore-based Luna Foundation Guard (LFG), committed to promoting Terra blockchain, bought another $176 million worth of Bitcoin last Sunday, following its recent purchase of $200 million worth of BTC on April 6.
The recent purchase showed an additional 4,130 BTC added to its wallet on April 10. This happened four days after its 5,040 BTC purchase on April 6.
LFG now carries a total of 39,897.98 BTC ($1.7 billion) of the largest cryptocurrency. The purpose of this huge hoard of Bitcoin is to further support its TerraUSD (UST) stablecoin, making an ideal way to maintain its peg for dollars at the times of utmost market volatility.
The Bitcoin accumulation started in late February, following the organization’s $1 billion sales of its native LUNA token. Consequently, this will become a stablecoin reserve based on the world’s largest cryptocurrency.
Co-Founder and CEO of Terraform Labs Do Kwon commented last week:
“I‘ve already donated money so that we can build up these reserves on behalf of the community and we plan to be doing this in perpetuity, so the $3 billion or so that we‘re buying initially to bootstrap the reserves is going to be followed up by […] persistent buys of Bitcoin through UST seniorage […] every time UST is minted, there will be new bitcoin that is added to the reserves.”
Terra wants to develop a “decentralized Forex reserve” with Bitcoin as its collateral, Kwon further explained. TerraUSD stablecoin will be backed by both their native LUNA token and Bitcoin.
Meanwhile, Kwon also shared on his Twitter last week that the plan was just getting started. Last month, the CEO said they originally planned to take in $3 billion in Bitcoin reserves. Moreover, the numbers will widen up to $10 billion depending on the amount of minted UST. He also shared the benefits of UST having $10 billion + of BTC reserves on a tweet:
The Bitcoin price has not been much affected by the series of Bitcoin purchases. At the time of purchase, the largest cryptocurrency price is up by barely 1.43% over the past 24 hours.
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