The Luna Foundation Guard (LFG), a nonprofit organization created specifically to support Terra Ecosystem, has disclosed details regarding the recent collapse of the project and notified UST holders of the impending compensation.
As it became known, the first in line to receive compensation will be the smallest holders of the infamous stablecoin.
10/ The Foundation is looking to use its remaining assets to compensate remaining users of $UST, smallest holders first.— LFG | Luna Foundation Guard (@LFG_org) May 16, 2022
We are still debating through various distribution methods, updates to follow soon.
Before a detailed study of the recent announcement, it is worth noting that LFG is the operator and creator of the UST Reserve protocol. The UST Reserve is a perpetual decentralized asset reserve for Terra community members.
According to data presented at the moment, the reserves of the foundation consist of:
- 313 BTC
- 39,914 BNB
- 1,973,554 AVAX
- 1,847,079,725 UST
- 222,713,007 LUNA (99% is staked with validators).
The estimated value of all the foundation's reserves is currently around $82 million. Сomparing these numbers with last week's data provided by the LFG, it can be roughly calculated that the foundation's reserves have shrunk by 97.4%!
No hard feelings for Terra
Despite a number of plans released during the week by the LFG, Terra ecosystem and Do Kwon, the founder and CEO himself, "lunatics" and the crypto world in general have mixed feelings about the future of the project. But sentiment is mostly negative.
The current situation has left no one behind.
Everyone from the head of FTX to Vitalik Buterin himself gathered to speak out and speculate on the topic.
On the one hand, of course, it is important to cover the problem extensively and warn crypto enthusiasts about the risks that may await. On the other hand, the project is now under enormous pressure, and it is in their interest to come out of the situation if not clean, then at least without losing face.