30s Summary

The Avalanche Foundation fully repurchased 1.97 million AVAX tokens from the insolvent Luna Foundation Guard (LFG) for approximately $53 million. The Avalanche Foundation claimed this acquisition would shield the tokens from becoming entrapped in bankruptcy proceedings, which is important for the continuity of the Avalanche network. The reclaimed tokens will be used for grants, events, and incubators.

Full Article

The Avalanche Foundation has finished buying back 1.97 million AVAX tokens from the now-broke Luna Foundation Guard (LFG). LFG was supposed to manage these tokens to help the Terra blockchain network, but that didn’t work out. The Avalanche Foundation announced they managed to get all the tokens back now. They were projected to buy the tokens for about $45.5 million, but they only spent around $27 on each token so the total came to approximately $53 million.

Back in 2022, Do Kwon, Terraform Labs founder, set up LFG to support Terra’s TerraUSD (UST) stablecoin. To do this, LFG had to buy up different types of cryptos, including $100 million worth of AVAX. They also swapped $100 million worth of Terra (LUNA) tokens for AVAX. But then things went downhill, with Terra crashing and a huge price drop for LUNA.

Since then, the Avalanche Foundation has been trying to buy back the tokens from LFG and finally managed to finalize a deal on October 12. They say this move was crucial to helping the Avalanche network by protecting the tokens from getting tied up in bankruptcy proceedings. According to their latest announcement, this buyback should help to make sure the Avalanche network keeps going. The repurchased tokens will be used for things like grants, events, and incubators.