Luna Foundation Guard Approves to Burn Extra 4 Million LUNA Token

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  • The burn will enable the LFG to mint around 372 million in UST.
  • Earlier in February 2022, the LFG raised $1 billion.

The Luna Foundation Guard, situated in Singapore, continues to carry out its mission of assisting in developing the Terra blockchain ecosystem. The non-profit organization has now voted in favor of yet another enormous LUNA token burn from its treasury, which will occur shortly.

According to the Luna Foundation Guard (LFG), the organization’s council has agreed to burn an extra 4 million LUNA, Terra’s native token, to fund the organization’s operations. According to the release, the burn will enable the LFG to mint around 372 million in UST due to the process. The so-called UST cryptocurrency is designed to work as an algorithmic stable coin tied to the United States dollar price.

Market Capitalization Surge

The proceeds of the burn are expected to be used to acquire external collateral, which will be used to protect UST reserves and assure greater circulating supply in the DeFi sector, according to reports. Earlier in February 2022, the LFG raised $1 billion to establish a bitcoin-backed reserve to protect the UST against the effects of a sharp decline in the cryptocurrency market.

Recent increases in investor interest for the stablecoin have prompted the drive to expand the amount of support for the United States Treasury’s reserve requirements. According to data from CoinMarketCap, the market capitalization of UST has increased dramatically since November 2021 and is presently valued at over $14 billion. Just a few days ago, Terraform Labs CEO Do Kwon took many bets on the price of LUNA while simultaneously claiming that UST would not de-peg the cryptocurrency.

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An engineering graduate who is passionate about writing and loves the very existence of crypto. Trading forex currency keeps me busy when I am not writing and analysing the crypto world.