42.5K BTC reportedly moved from Luna Foundation Guard wallet as UST peg crumbles

The Bitcoin price plunged below $31,000 on Monday, marking a new low for the year. Altcoins also sold off sharply.

Roughly $1.4 billion worth of Bitcoin (BTC) was reportedly moved from a wallet tied to Luna Foundation Guard (LFG) on Monday, raising questions about its ultimate destination on a day that has seen Bitcoin’s price tumble more than 11%. 

Data from blockchain explorer Blockchair revealed Monday that 42,530.82827771 BTC was spent from the LFG wallet, though its destination was unknown. It has been speculated that the funds were split into two batches — roughly 12,500 BTC and 30,000 BTC, respectively — with a portion reportedly sent to cryptocurrency exchange OKEX.

Around the same time, Twitter account Whale Alert revealed that 12,531 BTC had been transferred from an unknown wallet to another unknown wallet. Whale Alert provides tracker and analytics with reporting on large Bitcoin transactions.

The move came less than a day after LFG announced that it was taking decisive steps to “proactively defend the stability of the UST peg [and] broader Terra economy,” referring to its popular algorithmic stablecoin TerraUSD, which fell below its United States dollar peg. Measures included loaning $750 million worth of BTC to over-the-counter trading firms to help protect the peg of UST and to loan $750 million worth of UST to accumulate more Bitcoin as market conditions begin to stabilize.

UST reached a low of $0.9428 on Monday, according to CoinMarketCap.

UST has lost its peg on two occasions in the past, including the March 2020 COVI-19 liquidity event. Source: CoinMarketCap.

Related: LUNA drops 20% in a day as whale dumps Terra’s UST stablecoin — selloff risks ahead?

The value of Terra (LUNA) also declined significantly over the weekend, though project co-founder Do Kwon warned that the selloff was a result of a coordinated attack against the protocol. He also clarified on Sunday that LFG is “not trying to exit its Bitcoin position,” but that it was putting capital in the hands of a professional market maker to buy UST if the price falls below the peg and buy BTC if the price was greater to or equal to the peg.

On Monday, Kwon also tweeted that he would be “Deploying more capital,” though he didn’t specify to what extent.

Extreme market volatility follows LFG’s acquisition of $1.5 billion in Bitcoin completed last week via over-the-counter swaps with Genesis Trading and direct purchases from crypto venture fund Three Arrows Capital. At the time, the nonprofit organization was said to hold roughly $3.5 billion worth of BTC at an average price of around $37,100 per coin. BTC price reached a low of around $30,300 on Monday, according to data from Cointelegraph Markets Pro and TradingView.

This story is being updated. 


Share on facebook
Share on twitter
Share on pinterest
Share on linkedin
On Key

Related Posts

Overvalued or Undervalued? How much is Ethereum actually worth?

Ethereum (ETH) is one of the most popular and well-known cryptocurrencies. For the market, the Ether price is the second most important value after the Bitcoin. At the moment we saw a sharp drop in the value of Ethereum in 2022. But is Ethereum undervalued or overvalued today? In this article, we will tell you how much Ethereum

ETC Price Analysis: What is Ethereum Classic and its Battle With Ethereum

Ethereum Classic is a fork of Ethereum. People who closely observed the crypto world in 2016 know about the Ethereum hard fork. What is dramatic about the happening is that the once-vaunted “code is law” philosophy has been broken, pushing major waves in the crypto world. This post is all about ETC price analysis and its battle

Andreessen Horowitz Announces $4.5 Billion Fund for Crypto, Blockchain Sector

At a time when the digital assets market is witnessing an acute downturn, American venture capital fund Andreessen Horowitz has announced a new $4.5 billion fund for crypto and blockchain investments. This is the fourth fund from the Silicon Valley fund for the crypto asset class. Together, the fund now accumulates $7.6 billion. Andreessen’s first

Bullieverse Integrates ChainLink VRF for Bear Hunt NFT Game

The Bullieverse metaverse on Ethereum and Polygon have integrated the ChainLink Verifiable Random Function. The decision was made for a fair distribution of NFTs in the new Bear Hunt 3D game. Moreover, the function will help users verify the transparency of the game while also making sure everyone stands an equal opportunity to win the