The Luna Foundation Guard is a nonprofit entity that boosts Terra. It will buy $100 million in the native AVAX token from Avalanche. It comes after its latest $1 billion Bitcoin transactions. The entity wants to build a reserve, enabling its coins to retain their links to currencies of a flat nature.
From late February, LFG got $1 billion in funding through its sale of LUNA tokens. It is the native Terra currency. The LFG Governing Council includes the President of Jump Crypto, Kanav Kariya. The founders are co-creator at Terra, Do Kwon, and the head of research at Terraform Labs, Nicholas Platias.
Terra is a platform with a decentralized approach to applications, although with a novel tokenomic mechanism. LUNA functions harmoniously with Terra coins. If the stablecoin price slides, people can purchase the same below the original value, while exchanging it for LUNA at the fixed rate. LFC is stocking vast digital assets (non-correlated). The reserve will help ensure a release valve for the redemptions of UST as per its statement. The initial venture went into Bitcoin and has now forayed into other assets.
Platias states that with diversification of these non-correlated assets to leading ones like AVAX and BTC, the UST Reserve will provide a solid pool of assets for safeguarding against any market volatility. It will also relieve the pressure on the open-market arbitrage incentives at Terra. The strategy at LUNA is already creating waves among market watchers. Reports state that higher amounts of Bitcoin are accumulating daily than their creation. Leading buyers such as MacroStrategy (a subsidiary entity at MicroStrategy) and LFG were eating up ha majority of available BTC and holding onto the same. Prices are under pressure as a result. Available supply volumes are lower than before. Terra has been successful with this strategy. LUNA prices have achieved record highs of $119.18 already.