Luna Foundation Buys $100 Million in AVAX for Stablecoin Reserve: AVAX Rallies

After purchasing 35,767 BTC as part of their ambitious promise to buy $10 billion Bitcoin in order to back its UST stablecoin reserves, the Luna Foundation Guard (LFG) has diversified its portfolio, acquiring $100 million worth of Avalanche (AVAX) tokens.

Luna Adds $100 Million AVAX to Its UST Reserves

Earlier in the year, the LFG announced that it would work to build a reserve for its stablecoin, Terra (UST), by purchasing up to $10 billion in Bitcoin. Following a series of Bitcoin purchases in line with this goal, the LFG looked to make its first purchase of another cryptocurrency.

The LFG revealed that its $100 million purchase of the Avalanche (AVAX) token “marks the start of a diverse pool of layer one crypto assets helping support the $UST peg.”

According to Avalanche, the LFG decided to add AVAX to its reserve ahead of other Altcoins because of its “rapid growth and vast fan base.”

AVAX Rallies Despite Bearish Market

The news sparked a bullish day for AVAX, despite the bearish trend currently engulfing the broader crypto market. Over the last 24 hours, AVAX has rallied 6%, hitting a price of $89.65 from its daily low of $81.

The 24 hour price chart for Avalanche (AVAX). Source: Tradingview

Avalanche (AVAX) is now trading at $88.6295 at the time of writing, with its recent surge seeing the Altcoin claim 10th position in the largest crypto rankings, with a market cap of $23.8 billion.

On The Flipside

  • As part of its recent rebalancing, Grayscale announced the addition of Avalanche and Polkadot to its ‘Digital Large Cap Fund’.

Why You Should Care

Luna is backing its UST stablecoin with other assets as a means to defend the Terra ecosystem against intense volatility and contractions in UST demand.

This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed to be financial legal or tax advice. Trading Forex, cryptocurrencies, and CFDs poses a considerable risk of loss

Author

Milko is a DailyCoin reporter, mainly focused on Ethereum (ETH), Cardano (ADA), and their founders (Vitalik Buterin and Charles Hoskinson). Milko is an avid follower of crypto and blockchain technology and has written thousands of articles on the subjects. He finds joy in transforming complex issues into written content that anyone can understand. Milko has used and analyzed numerous exchanges, such as Coinbase, FTX, and Binance. He also closely follows all of the latest news around the largest decentralized exchanges (DEXs).