Breaking: Luna Foundation Guard Member Says Terra Reserves En Route
A high-ranking member of the Luna Foundation Guard (LFG) said on Monday that the foundation’s reserves are almost ready to be deployed, barring a few technicalities.
The reserves will be largely targeted towards helping small wallets, and supporting builders and stakers on Terra.
The statements were made by Remi Tetot- a member of the LFG’s Governing Council. Tetot said he was “breaking rank” in the LFG to release the information. He also decried the lack of regular communication by key Terra developers, in wake of the recent crash.
Tetot said the LFG is now waiting for confirmation from exchanges on the timing and the transactions needed to release the reserves, which are estimated to be around $1.5 billion.
He also said an official statement will be issued soon, but did not specify an exact date.
How will the LFG reserve help Terra?
Considering the pace at which the UST stablecoin has been depleted, it seems unlikely that the reserves will be deployed to protect the peg.
Several community proposals have asked Terra to help holders and stakers recover some amount of their value. So far, burning UST and LUNA tokens has done little to support prices.
With Tetot’s comments, it appears that supporting developers and small holders will be a priority- something that Terra founder Do Kwon had also posited last week.
Over the weekend, Ethereum founder Vitalik Buterin also called for Terra to first bail out its smallest holders.
Two popular plans to bail out UST, LUNA holders
Currently, two Terra governance proposals appear to be favoured for returning some value to stakeholders. They are the Revival Plan and the FatMan Plan.
The Revival Plan calls for a hard fork in the Terra blockchain, resulting in the creation of 1 billion Terra 2.0 tokens, which will then be distributed among developers, holders and investors in the project.
The FatMan Plan calls for the LFG to distribute its $1.5 billion reserves to all UST holders prior to the de-pegging- helping them recover at least some value on their investment.
But the community is yet to vote on either proposal. Terraform Labs and Do Kwon have also shared few details on the path forward.
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