The price of Terra’s native cryptocurrency, LUNA, has reached the $55 mark for the second time in a week. The Luna Foundation Guard received $1 billion from an over-the-counter LUNA sale (LFG).
Bitcoin-denominated Foreign Exchange Reserve
Other investors, in addition to Jump Crypto and Three Arrows Capital, engaged in the fundraising effort and helped to its success, including GSR, DeFiance Capital, Republic Capital, Tribe Capital, and others. The Luna Foundation Guard was established in January of this year as a non-profit organization to encourage Terra’s advancement. This $1 billion auction money will be used by UST stablecoins to create a Bitcoin-denominated FX reserve.
Terra elucidates the mechanism:
“When there is a great demand for Terra and a limited supply, the price of Terra rises.” When demand for Terra is low and supply is abundant, the price of Terra falls. The protocol ensures that Terra’s supply and demand are always balanced, resulting in a steady price.”
The LUNA Foundation Guard chose the Bitcoin-denominated Forex Reserve because they believe it is “less connected to the Terra environment.” LFG will provide additional information about the reserve function and design of the UST in the coming weeks.
Terra’s native stablecoin, UST, is an algorithmic stablecoin in the DeFi ecosystem. Users can generate new Terra-based UST stablecoins by burning LUNA tokens. LUNA can be produced by burning UST. The Terra price today is $56.61 USD, with a 24-hour trading volume of $2,255,490,109 USD, according to CoinMarketCap. Terra has increased by 15.12 percent in the last 24 hours.