The Luna Foundation, one of the two corporations behind the Terra Blockchain platform, has acquired another 37,863 bitcoins worth one point five billion dollars at the time of purchase. The most recent purchase puts the corporation’s bitcoin holdings at 80,394 BTC. The Luna Foundation and a non-profit organisation established in Singapore reported the purchase on Thursday, May 5, 2022.
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According to an earlier announcement, LFG is going to continue swooping up additional bitcoin. It aims to have 10 billion dollars’ worth of bitcoin for its stable coin reserved by September 2022. In addition to its over 80 million dollar stash of bitcoin, LFG has purchased 100 million dollars worth of Avalanche for its algorithmic stablecoin USD decentralised forks reserves in two over-the-counter transactions. LFG said it traded one billion dollars’ worth of UST for bitcoin with Genesis. Another 500 million dollars’ worth of bitcoin was purchased from Three Arrows Capital, a Singapore-based hedge fund. The manager and co-founder and CEO of Terraform Labs, Do Kwon says the platform’s bitcoin reserves are in line with the bitcoin standard. ‘For the first time, you’re starting to see a paid currency that is attempting to observe the bitcoin standard,’ Kwon stated. ‘It is making a strong directional bet that keeping a lot of those foreign reserves in the form of a digital native currency is going to be a winning recipe.’
He added that the latest purchase puts Terra’s bitcoin holdings almost double Tesla’s at 42,902 bitcoin. With less than 50 000 bitcoin, Terra will also catch up with Microstrategy’s 129,218 bitcoin. The analytics company is currently the public company with the largest bitcoin holdings. Like Terra, Microstrategy intends to buy more of the assets in the future.
While speaking further about the purchase on Thursday, Do Kwon stated that the effectiveness of bitcoin as a reserve currency is still unknown, but the poor state of monetary policies in most countries calls for urgent and effective measures. When there is success in money printing across the board and when monetary policies are so highly politicised that citizens are self-organizing to try to bring systems back to a sounder paradigm of money. The Terraform CEO concluded that with the present state of most of the world’s economies, companies like Microstrategy and Terraform Labs are adopting the bitcoin standard.
According to Michael Saylor, Microstrategy started buying in August 2020 because of the rapid rate of inflation in the United States. The Central African Republic has also followed a similar route to try to salvage its economy. Within the next few months, many other institutions will join the race and buy as many bitcoins as they can now before it reaches wider adoption. What do you think about Terra’s purchase? How will the stash impact bitcoin and Terra’s UST?
[This article is a transcription of a video made by Savvy Finance]
Original video: https://youtu.be/R-yeiLJOAlU ]