AVAX Shoots 7% As Luna Foundation Guard Adds Avalanche to the UST Reserve

By Bhushan Akolkar

Ethereum Layer-1 competitor Avalanche (AVAX) has received a major boost as the Luna Foundation Guard announced it is adding $100 million in AVAX to its UST reserves.

Following the news, AVAX is trading 7% up at a price of $88 as the tenth-largest cryptocurrency with a market cap of $23 billion. This also makes Avalanche (AVAX) the first major cryptocurrency beyond Bitcoin to be added to the UST reserve.

The Singapore-based non-profit organization – Luna Foundation Guard – has pledged to buy $10 billion worth of Bitcoin (BTC) as UST reserves. Of which, it has already acquired $1.7 billion worth of BTC.  This new purchase of Avalanche (AVAX) comes as a major diversifying strategy for Terra.

Do Kwon, founder of Terraform Labs, said the Luna Foundation Guard chose Avalanche as a UST reserve because of its rapid growth and wider fan base. Speaking to Bloomberg, Kwon said:

“Avalanche is still a growing ecosystem…a lot of it is fueled by loyalty to the AVAX token and users feel a lot of affinity with an asset that aligns itself with AVAX. Whereas for the average Ethereum user, aligning yourself with Ether doesn’t really mean that much.”

What Does It mean for Avalanche?

Unlike LFG’s Bitcoin reserve which rests on the Terra blockchain, the AVAX reserves will rest on the Avalanche blockchain. In the future, several applications on the Terra blockchain will also launch a version for the Avalanche blockchain.

Furthermore, this strategic partnership will also allow Avalanche users to trade UST against Avalanche tokens directly on the avalanche blockchain.

Emin Gün Sirer, CEO of The Ava Labs, Avalanche’s developer said Terra’s ability to scale stablecoins is one of the key reasons behind drawing Avalanche to its platform. He added:

“I wish that more and more coins would look for ways to grow the crypto space as opposed to compete for the same set of people”.

Advertisement
Bhushan Akolkar
Bhushan is a seasoned crypto writer with over eight years of experience spanning more than 10,000 contributions across multiple platforms like CoinGape, CoinSpeaker, Bitcoinist, Crypto News Flash, and others. Being a Fintech enthusiast, he loves reporting across Crypto, Blockchain, DeFi, Global Macros with a keen understanding in financial markets. 

He is committed to continuous learning and stays motivated by sharing the knowledge he acquires. In his free time, Bhushan enjoys reading thriller fiction novels and occasionally explores his culinary skills. Bhushan has a bachelors degree in electronics engineering, however, his interest in finance and economics drives him to crypto and blockchain.
Why trust CoinGape: CoinGape has covered the cryptocurrency industry since 2017, aiming to provide informative insights to our readers. Our journalists and analysts bring years of experience in market analysis and blockchain technology to ensure factual accuracy and balanced reporting. By following our Editorial Policy, our writers verify every source, fact-check each story, rely on reputable sources, and attribute quotes and media correctly. We also follow a rigorous Review Methodology when evaluating exchanges and tools. From emerging blockchain projects and coin launches to industry events and technical developments, we cover all facets of the digital asset space with unwavering commitment to timely, relevant information.
Investment disclaimer: The content reflects the author’s personal views and current market conditions. Please conduct your own research before investing in cryptocurrencies, as neither the author nor the publication is responsible for any financial losses.
Ad Disclosure: This site may feature sponsored content and affiliate links. All advertisements are clearly labeled, and ad partners have no influence over our editorial content.