Luna Foundation Guard (LFG), a nonprofit organization created to support the Terra ecosystem, announced a May 5 purchase of $1.5 billion in bitcoin (BTC) as a reserve for its Stablecoin.
LFG reportedly bought 37,863 BTC through OTC swaps with Genesis Trading and Three Arrows Capital. Of the $1.5 billion, $1 billion was an OTC swap with Genesis, with the remaining $500 million purchased from Three Arrows Capital.
As a result, LFG’s bitcoin reserves rose to $3.5 billion, 30% of its stated goal of $10 billion. The purchase also made LFG’s wallet the seventh largest holder of BTC (BitInfoChart data).
In addition to bitcoins, LFG purchased $100 million worth of Avalanche tokens (AVAX), also as a reserve for its Stablecoin.
LFG’s strategy is part of a nascent trend in which algorithmic stackcoins acquire crypto-assets as part of their collateral reserve. Tron’s USDD Stablecoin has also launched with plans for a $10 billion collateral reserve.