Terraform Labs donates $ 1.1B for Luna Foundation Guard’s reserves By Cointelegraph

On Friday, Do Kwon, founder and CEO of Terraform Labs, which develops the blockchain ecosystem consisting of Luna (LUNA) and the TerraUSD stablecoin (UST), announced that TFL had donated 12 million LUNA, or $ 1.1 billion at the time of publication to the Luna Foundation Guard (LFG). LFG launched in January to grow the Terra ecosystem and improve the sustainability of its stablecoins. Kwon noted that the funds, denominated in LUNA, will be burned to mint UST to grow the LFG’s reserves:

UST is an algorithmic stablecoin with a theoretical exchange rate of 1: 1 with the US dollar and is in part maintained by swapping of / for LUNA tokens when its market value deviates from its peg. The burning of $ 1 in UST results in the minting of $ 1 in LUNA and vice versa.