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Terra (LUNA) Sold 80,000 Bitcoins In A 3-Day Span Amid Depeg-Crisis: UST Holder Compensation Coming

When TerraUSD (CRYPTO: UST) — the stablecoin integrated into the Terra (CRYPTO: LUNA) ecosystem — lost its peg to the U.S. dollar last week, Luna Foundation Guard (LFG), the non-profit backed by TerraLabs tasked with protecting TerraUSD's peg, mostly emptied its hefty reserves.

What Happened: Benzinga reported earlier on Monday that after TerraUSD's unpegging, Bitcoin (CRYPTO: BTC) worth $750 million was sent from LFG to one address, shortly followed by another 30,000 Bitcoin worth $930 million sent to the same address. Now, the crypto community is asking what happened to this Bitcoin and all the other cryptocurrencies stored in the organization's deep pockets. Fortunately, a lengthy Twitter thread on Monday sheds light on this question.

See Also: How To Earn Free Crypto

In the thread, the Luna Foundation Guard notes that as of May 7 its reserves held nearly 80,400 Bitcoin, 40,000 BNB (CRYPTO: BNB), 26,281,671 Tether (CRYPTO: USDT), 23,555,590 USD Coin (CRYPTO: USDC), 1,973,554 Avalanche (CRYPTO: AVAX), 697,334 TerraUSD and 1,691,261 Terra. When the price of TerraUSD fell below $1 on May 8, LFG started converting its reserves to the stablecoin by directly selling 26,281,671 Tether and 23,555,590 USD Coin for a total of 50,200,071 TerraUSD.

When it comes to Bitcoin, LFG transferred 52,189 Bitcoin to a counterparty, of which an excess of 5,313 Bitcoin was returned and exchanged it for 1,515,689,462 TerraUSD. Then, on May 10, TerraUSD's price fell to $0.75 and 33,206 Bitcoin were sold for 1,164,018,521 TerraUSD in an attempt to stabilize the market. On May 12, LFG also swapped 883,525,674 TerraUSD for Terra to protect the network against a governance attack that could become practical with the continuously rising number of Terra tokens in circulation.

After all those actions, LFG holds 313 Bitcoin, nearly 40,000 BNB, 1,973,554 Avalanche, 1,847,079,725 TerraUSD and 222,713,007 Terra — for a total value under $91 million as of press time. LFG now plans to use those assets to compensate TerraUSD holders starting with the smallest holders first, but the reserves only cover a small portion of the money lost in the TerraUSD depegging.