Terra Luna Foundation Guard Freezes $100 Million Compensation Reserve
The Luna Foundation Guard (LFG), a non-profit organisation that protects the Terra environment, has stopped the scheduled release of $100 million from its reserve to smallholders of U.S. Treasury notes due to legal concerns.
The group tweeted on Friday that they are suspending the distribution of LFG’s assets owing to the possibility of litigation. The LFG said that they do not have a clear date for when the distribution may restart.
The foundation said that it remains committed to distributing LFG’s remaining assets to UST holders, beginning with smaller investors.
Following the catastrophic collapse of Terra’s algorithmic stablecoin, which wiped away around $60 billion from the crypto market, the LFG provided a comprehensive report on how it used its reserves to protect the UST peg. The foundation said it would utilize the remaining assets, valued at around $100 million, to reimburse the remaining UST holders.
Recently, Terra founder Do Kwon made statements that contradict the LFG’s assertions. After rumours circulated that South Korean authorities had frozen 56.2 billion ($39.9 million) in crypto assets belonging to Kwon, he said on Thursday that his assets had not been blocked.
“Once again, I don’t even use Kucoin and OkEx, have no time to trade, and no money have been frozen,” he tweeted in response to a CoinDesk tweet claiming that South Korean authorities had frozen around $40 million of Kwon’s cash.
Local South Korean media site News1 reported on Wednesday that the LFG constructed a Binance wallet with around 3,313 BTC one day after Kwon’s arrest order was issued. According to the study, around $27.6 million worth of BTC was moved from Binance to KuCoin and approximately 56.2 billion was won to the OKX exchange in the three days that followed.