Months after the collapse of Terra’s U.S. dollar-pegged token UST, the organization created to protect the once-stable coin, the Luna Foundation Guard (LFG), published an audit report audited by the New York-based consultancy company JS Held. According to the report, LFG claims to have spent 80,081 bitcoin and 49.8 million stablecoins, which add up to roughly $2.8 billion to defend UST’s peg.
LFG Audit by JS Held Claims Group Defends UST Peg With $2.8 Billion in Crypto Assets
On November 16, 2022, a few months after the Terra stablecoin dipping incident in mid-May, the Luna Foundation Guard (LFG) published a blog post about an audited transparency report, which claimed the organization had taken steps to protect UST. spent $2.8 billion in crypto assets. The one-time stable coin UST is now called terrausd Classic (USTC), and it is currently trading at $0.02 per unit on November 16, 2022.
Terraform Labs co-founder Do Kwon also tweeted about the audit on Wednesday. “A third-party audit of LFG and TFL’s peg defense activity during May 2022 has been published,” Kwon tweeted. Terra’s co-creator further added:
Many of you have lost a lot of money in UST – I am sorry for that. While the system was transparent and open source, as its creator I should have better understood and communicated its risks.
In the report published by the LFG, it says that the technical audit was done by the New York firm JS Held. It defends both LFG’s and Terraform Labs’ (TFL) actions during the UST depegging event. “LFG spent ~$2.8B (80,081 BTC and 49.8M in stablecoins) to defend UST’s peg, consistent with LFG’s tweets on May 16th, 2022,” LFG’s blog post says. “Additionally, TFL went above and beyond and spent $613M of its own capital to defend UST peg.”
“We relied on a variety of quantitative and qualitative information, including on-chain data; TFL and LFG trading records obtained by JSH directly from the exchanges; and consulting with TFL business,” the audit by JS Held states. The report also noted that TFL closed accounts on Binance holding BTC, ETH, BNB, USDT, BUSD, Luna and UST around May 8, 2022. Maintained.
LFG says the audit dispels any allegations like embezzlement or misuse of funds, helping insiders, or that the LFG funds were frozen by law enforcement. “The report shows that all LFG funds were spent to defend UST’s peg parity with the dollar as declared, and that LFG’s remaining balances are the only funds remaining,” LFG said on Wednesday.
More recently it was reported that Terraform Labs co-founder, Daniel Shin (Shin Hyun-seung) had TfL and his business Chia Corporation raided this week in connection with “unfair trade practices”. Other reports coming from South Korea’s local media detail that Terralabs’ more outspoken co-founder, Do Kwon, is reportedly hiding in Europe.
