Recently the network has seen development that resulted in notable growth of its digital assets trading prices
Non-profit organizations behind the Terra ecosystem, Luna Foundation Guard (LFG) and Terraform Labs (TFL), have sought to acquire AVAX tokens in significant amounts. Terra ecosystem’s subsidiaries TFL and LFG have purchased Avax tokens of Avalanche network worth approx $200 million. The acquisition would let Terra network diversify its stablecoin USDT’s reserves that are only reserved for bitcoin for now.
LFG and TFL made the purchase differently. First, the Luna Foundation Guard came up with the notion of acquiring AVAX tokens using Terra UST stablecoins of $100 million worth. The purchasing followed an over the counter trade with the Avalanche Foundation in order to add to its reserves of UST stablecoins.
Later, Terraforms Labs announced a treasury swap of approx $100 million for AVAX tokens demonstrating its commitment which is made to Avalanche through collaborations and cross chain developments. Swapping or acquiring of AVAX tokens with UST would be seen as a step towards cross chain developments while both Terra and Avalanche networks are currently collaborating with each other on a gaming subnet.
Prior to this week, there was more than $230 million worth of bitcoin was added to the UST stablecoin reserves that had made bitcoin reserves pushing to its total to around $1.6 billion.
Founder and CEO of Terraform Labs, Do Kwon, announced that the network has plans to add $10 billion worth of Bitcoin to its UST reserves in march. On Wednesday, 4th April 2022, the native cryptocurrency of Terra network, Luna has, attained a new all time high of about $119.18. At the time of writing, it’s been trading with a 2.6% drop in 24 hours with a current trading price of $105.29.
Adding new and exclusive tokens and coins to back own stablecoins plays a crucial role in expanding its usability and wider acceptance. Terraform Labs is following the usual notion of bringing its stablecoin UST to a larger extent in terms of its acceptance of using more and more addition of digital assets in its portfolio.
Source: https://www.thecoinrepublic.com/2022/04/08/terra-buying-avax-for-200-million-stepping-to-promote-cross-chain-development/