What happened to the Bitcoin reserve behind Terra’s UST Stablecoin?

Bitcoin has been below the $ 26,000 level since December 2020. (Photo credits should be read as CFOTO / Future Publishing via Getty Images)

CFOTO | Future publications by Getty Images

Investors want to know what happened. $ 3 billion Bitcoin It was acquired by crypto company Terra to back up the failed Stablecoin. Now they have their answer.

Luna Foundation Guard, a fund founded by Terra creator De Kwon, Said on monday Last week, I spent almost all of my Bitcoin in reserve, a futile attempt to save terraUSD (UST for short).

The Foundation has accumulated over 80,000 Bitcoins in total. worth Over $ 3 billion last week. Kwon promised to use Bitcoin if the value of UST dropped dramatically.

In a series of tweets, the Luna Foundation Guard said it had transferred 52,189 Bitcoins to a “counterparty transaction” because it was below the $ 1 peg that UST intended. According to the Foundation, an additional 33,206 Bitcoins were sold directly by Terra in the final effort to protect the pegs.

As of Monday, there are only 313 Bitcoins left in the Luna Foundation Guard reserve, worth about $ 9.3 million. The company said it would use the remaining assets (including other digital tokens such as BNB and avalanches) to “compensate for the remaining users” of UST.

“We are still discussing different distribution methods and updates will continue shortly,” said the Luna Foundation Guard.

UST is what is known as the “algorithm” stablecoin. Unlike tethers and USDCs that keep flat assets in reserve to back up tokens, UST is a complex code combined with floating tokens called Luna to balance supply and demand and stabilize prices. It depended on the combination.

Luna also started to sell out when UST started to fall below $ 1 last week. As a result, UST created a vicious cycle of plunging to less than 30 while Luna became worthless. According to CoinGecko data, the value of UST is only 9 cents.

Collapse of Terra tokens Ripple on the crypto marketWipe out over $ 200 billion in wealth in one day. Bitcoin Bitcoin, which plunged temporarily on Thursday, fell below its lowest level since December 2020, at $ 26,000.

What happened to the Bitcoin reserve behind Terra’s UST Stablecoin?

Source link What happened to the Bitcoin reserve behind Terra’s UST Stablecoin?

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