Luna Foundation Guard to Issue $372 Million in UST Tokens
Non-profit organization Luna Foundation Guard (LFG), which is associated with the development of the Terra ecosystem, has just announced it has burned 4 million LUNA tokens to issue $372 million in the stablecoin UST for the subsequent purchase of “external collateral.”
According to the project, the objective of the initiative is to increase the sustainability of the 1:1 UST-USD peg in the light of the market current turbulence. After its implementation, LFG reserves will amount to about $2.2 billion, in addition to 8 million LUNA.
The stablecoin peg was maintained solely through the LUNA burn mechanism prior to the creation of collateral.
Some analysts believe that the price of the asset will go down no matter what devs do dragged down by the bearish market, which could eventually lead to the loss of stability in UST.
