The Luna Foundation Guard revealed how much of their crypto reserves were sold in order to defend the TerraUSD (UST) $1 peg. It is said to have exhausted almost all of its Bitcoin reserves, currently holding 313 BTC, down from 80,394 BTC.
When the value of UST fell at the beginning of last week, LFG announced it would begin selling bitcoin reserves and purchasing UST.
LFG stated it would lend $750 million in Bitcoin to OTC trading firms to help protect the UST peg. Do Kwon, the creator of Terra, later clarified that the bitcoin would be “used to trade.”
The smallest holders of the infamous stablecoin will be the first to receive compensation, as confirmed by Remi Tetot, a member of the LFG’s Governing Council.
As the UST price began to fall, LFG transferred over 52,189 BTC “to trade with a counterparty.” The counterparty returned these BTC except for an excess of 5313 in exchange for 1,515,689,462 UST. Besides that, around 33,000 BTC were transferred for about 1.1 million in UST.
Also read: Why Terra Luna is Crashing Down with its Stablecoin UST?
They used the funds for directly executing on-chain swaps and transferring BTC to a counterparty to enable them to enter large-scale and short-notice trades with the Foundation. The validators now hold most of the remaining LUNA reserves.
