Terra’s Luna Foundation Guard Issues Audit Report, Do Kwon Responds
Luna Foundation Guard (LFG), a non-profit that manages UST algorithmic stabilitycoin, has released a technical auditor to provide full transparency into assets as well as efforts to repeg TerraUSD(UST) in May. LFG will investigate all allegations, including insiders, misappropriation of funds, holdings in other wallets and funds being frozen. According to the report, LFG and TFL spent nearly $3.4 billion to defend UST’s peg.
LFG Spends $2.8 Billion to Defend UST Peg
In a tweet, the Luna Foundation Guard revealed that JS Held had provided a technical audit report to them. The audit report shows that LFG spent nearly $2.8 billion between May 8-12 in order to defend TerraUSD’s (UST). peg. This includes 49.8 million stablecoins and 80,081 BTC.
Terraform Labs spent $613 million more to defend the peg. According to the report, LFG claimed that it spent all funds necessary to prevent UST losing its peg. The remaining balances were the only remaining funds.
LFG was the second largest holder of Bitcoin. It planned to increase its Bitcoin reserves by $10 billion. Despite the fact that nearly $2.5 billion was lost suddenly, LFG failed to protect the UST peg in extreme market volatility. It had a $60 billion effect on crypto investors’ lives.
The Luna Foundation Guard is also seeking to address allegations against it. It claims that no LFG funds were stolen, used to benefit insiders, and saved in secret wallets. All LFG funds are stored in self-hosted wallets, and have not been moved since May 16.
Do Kwon, Terra founder, claims that Terra is unique from other crypto failures. He also cited the failures of FTX, where its operators misappropriated customer funds for financial gain.
“While there have been many recent failures in crypto, we must distinguish Terra’s case where a transparent, decentralized stablecoin was not able to maintain peg parity, and its creators spent proprietary money to defend it.”
Many believe that LFG and TFL should be audited by the big four auditing firms due to their size. Do Kwon said that the size of the company is not large now.
Terra Tokens saw an increase in volume
Terra tokens, including LUNA and LUNC (previously UST), saw an increase in trading volume. The LUNA price is currently trading at $1.66 and has fallen over 1% over the past 24 hours. Terra Classic (LUNC), and USTC both saw a 3% and 1% increase, respectively. Terra Classic trades at $0.00017
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