Avalanche Buys Back $52M in AVAX, Ends Ties with Terra

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Cryptodnes2024/11/07 23:33

By:Cryptodnes

The Avalanche Foundation has reportedly reclaimed $52 million in AVAX tokens from the now-bankrupt Luna Foundation Guard (LFG), effectively ending its ties with Terra’s failed blockchain network.

This buyback follows LFG’s collapse, an organization created by Terraform Labs founder Do Kwon in 2022 to support the TerraUSD (UST) stablecoin, which eventually lost its dollar peg. LFG aimed to amass a substantial reserve, including Bitcoin and AVAX , to bolster UST’s value.

As part of a joint strategy at the time, LFG acquired $100 million in AVAX, while the Avalanche Foundation purchased $200 million in UST and LUNA to foster cross-support between the two ecosystems.

The relationship faltered after UST’s dramatic crash, which left Avalanche and other Terra-linked entities facing significant losses.

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Following a recent court ruling, Avalanche has successfully moved forward with the AVAX repurchase, finally distancing itself from Terra’s turbulent legacy.

Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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