LFG Adds $1.5 Billion in Bitcoin to UST Reserves

The purchase comes less than a month after LFG acquired $100 million of Avalanche’s AVAX

article-image

Do Kwon, CEO of TerraForm Labs | Blockworks Exclusive Art by Axel Rangel

share

key takeaways

  • Do Kwon wants UST reserves to hit $10 billion in bitcoin
  • LFG partnered with Genesis Trading and Three Arrows Capital to complete the purchase

With help from Genesis Trading and Three Arrows Capital, the Luna Foundation Guard (LFG) has added $1.5 billion in bitcoin to its UST stablecoin reserves. 

LFG, the nonprofit organization built to support Terra, announced Thursday that it had closed a $1 billion over the counter swap of UST for bitcoin led by digital asset prime broker, Genesis. The average price of the purchases has not been disclosed.

LFG purchased $500 million worth of bitcoin via crypto hedge fund Three Arrows Capital, making the total purchases by the LFG $1.5 billion in bitcoin.

“The LFG’s mission to support the stability and adoption of the UST stablecoin continues with the latest deal acquiring BTC from Genesis for the UST Forex Reserve,” Do Kwon, LFG governing council member and co-founder and CEO of Terraform Labs, said in a statement. “As the leading broker in digital currencies, Genesis’ participation displays the growing demand for decentralized stablecoins in the broader crypto market, helping to build bridges across crypto communities tied together by a common decentralized money.”

The purchase brings LFG’s bitcoin holdings to around $3 billion. Kwon has said that he hopes to eventually acquire $10 billion in bitcoin reserves. 

“LFG has announced they intend to continue to acquire BTC as the preferred long-term stabilizing asset for UST,” Jordi Alexander, chief investment officer at Selini Capital, and a noted Terra skeptic, said.

“While there may now be a temporary pause on their purchases, if UST issuance continues to go up in the future, it would not be surprising to see them start buying again to move towards their intermediate target of $10 billion in bitcoin.”

The announcement comes less than a month after LFG acquired $100 million of the Avalanche Foundation’s native token AVAX to build UST reserves. Industry members were not surprised by the choice, given that a $100 million swap is close to 0.5% of AVAX’s market cap, making it a good opportunity to bring new fans and users to UST.


Get the day’s top crypto news and insights delivered to your email every evening. Subscribe to Blockworks’ free newsletter now.


Want alpha sent directly to your inbox? Get degen trade ideas, governance updates, token performance, can’t-miss tweets and more from Blockworks Research’s Daily Debrief.


Can’t wait? Get our news the fastest way possible. Join us on Telegram and follow us on Google News.


Tags

upcoming event

MON - WED, MARCH 18 - 20, 2024

Digital Asset Summit (DAS) is returning March 2024. This year’s event will be held in our nation’s capital, where industry leaders, policymakers, and institutional experts will come together to discuss the latest developments and challenges in the ever-evolving world of cryptocurrency. […]

upcoming event

MON - WED, SEPT. 11 - 13, 2023

2022 was a meme.Skeptics danced, believers believed.Eventually, newcomers turned away, drained of liquidity and hope.Now, the tide is shifting and it’s time to rebuild. Permissionless II is the brainchild of Blockworks and Bankless. It’s not just a conference, but a call […]

recent research

Curve's Stablecoin and Lending Market

Research

AMMs are at the root of everything elegant and useful in DeFi.That's why Curve put LLAMMA at the center of its lending protocol.

/

article-image

Given the impressive growth trajectory and unpredictable future of crypto markets, the potential systemic risks cannot be dismissed, the board said

article-image

Five years after the ICO boom and bust, the notion of traditional finance assets existing on the blockchain is not nearly as far fetched

article-image

The Fahrenheit Consortium beat out competing offers from Novawulf and BRIC

article-image

A research paper modeled the reliability and carbon footprint of crypto mining in Texas

article-image

Bring in the next million developers, and then we can start worrying about where to find the next billion users

article-image

Sponsored

Web3 real estate investing platform Parcl leverages blockchain to address the current bottlenecks facing property investing