Luna Foundation Guard Announces $1.5 Billion Bitcoin Purchase

the main ideas:

  • Overnight, Terra’s (LUNA) Luna Foundation Guard (LFG) announced a series of Bitcoin (BTC) purchases totaling $1.5 billion.

  • The BTC purchases, over the past few days, came during a volatile period for BTC and the broader crypto market.

  • Technical indicators are bearish for LUNA, with LUNA below 50 days.

The Luna Foundation Guard (LFG) has been in Bitcoin (BTC) buying mode since it announced plans to hold $10 billion in BTC reserves for TerraUSD (UST). In February, LFG created a BTC-denominated reserve for UST.

UST is pegged to the US dollar. The binding mechanism involves the issuance and burning of LUNA tokens. At times when the price of the floor cabinets is above $1, users can use the floor cabinets by burning the LUNA device. Burning the LUNA reduces the supply of LUNA, which increases the value of the LUNA.

To reach the BTC reserve target of $10 billion, LFG has been actively buying BTC. This week, LFG announced another big purchase.

Luna Guard Foundation buys Bitcoin reserves totaling $1.5 billion in BTC

Overnight, the Luna Foundation Guard (LFG) announced the purchase of another $1.5 billion in BTC.

LFG retweeted several tweets from the media about the latest series of BTC purchases.

According to CNBC,

“The Luna Guard Foundation has acquired $1.5 billion in bitcoin to boost the reserves of its most popular stablecoin, known as the US Terra.”

CNBC went on to say,

“The reserve now holds about $3.5 billion worth of bitcoin, which puts UST Forex Reserve in the top 10 list of bitcoin holders in the world. It also owns $100 million in Avalanche, another cryptocurrency.”

According to the report, LFG has purchased $500 million from Three Arrows Capital, a cryptocurrency hedge fund. The other billion dollars came from an over-the-counter swap.

Do Kwon, co-founder and CEO of Terra Labs, also announced the $1.5 billion BTC purchase on Twitter, saying:

“LFG has gained 1.5 billion worth of bitcoins over the past few days.”

Do Kwon took to Twitter,

“Don’t worry about #Bitcoin – it’s an alternative freedom to confront state violence that can be redeemed at will.”

adding,

“And its rise will be inevitable as long as mankind yearns for freedom.”

The news of the purchase had a muted effect on LUNA, which succumbed to the forces of the broader crypto market.

LUNA device price movement

At the time of writing, LUNA is down 0.10% to $82.28.

LUNA remains under pressure after Thursday’s 4.43% drop which reversed a 4.46% gain from Wednesday.

On Thursday, market concerns about inflation, the Federal Reserve’s monetary policy, and the broader crypto market left LUNA and the broader crypto market in negative territory.

Technical Indicators

LUNA will need to move across the $82.92 pivot for the day to target the first major resistance level at $87.27. LUNA will need the broader crypto market to support the hack from $85.

An extended rally would test the $90 resistance and the second major resistance at $92.15. The third major resistance level is located at $101.38.

A failure to move across the pivot will trigger the activation of the first major support level at $78.03. Barring an extended sale, LUNA should stay away from under $75. The second major support level is located at $73.69.

Failure to move through the hub will leave the LUNA under stress.

Failure to move through the hub will leave the LUNA under stress.

Looking at the exponential moving averages and the 4-hour candlestick chart (above), it is a bearish signal. LUNA is below the 50-day moving average, currently at $84.89. This morning, the 50 day moving average pulled out from the 100 day moving average. The 100-day moving average has also fallen from the 200-day moving average. The price of the LUNA is negative.

A move across the 50-day moving average may change sentiment in the near term.

Indicators are bearish with LUNA below the 50-day EMA.

Indicators are bearish with LUNA below the 50-day EMA.

This article was originally published on FX Empire

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