Avalanche States LFG Has Not Disclosed Plans for Its AVAX Tokens

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Altcoin News

  • Given the proposed Terra fork, LFG has disclosed no plans to use the AVAX.
  • This comes after LFG and Terraform Labs announced in April that they had collectively acquired $200 million worth of Avalanche’s AVAX tokens.
  • Some members of the Avalanche Community have inquired about details around the AVAX reserves.

Avalanche, a smart-contract blockchain, revealed in a tweet that Luna Foundation Guard (LFG)—the entity behind the reserve fund set up to backstop the Terra blockchain’s now failed UST stablecoin, has “disclosed no plans” for the 2 million AVAX tokens currently sitting in its treasury.

The tweet stated that “Given the proposed Terra fork, LFG has disclosed no plans to use the AVAX.” The Tweet also stated that “should any sales be contemplated for the LFG reserves, the Avalanche Foundation is ready to work with LFG on a sensible trading strategy.”

This comes after LFG and Terraform Labs (TFL) announced in April that they had collectively acquired $200 million worth of Avalanche’s AVAX tokens from the Avalanche Foundation.

The Avalanche Foundation received $100 million worth of LUNA from Terraform Labs and $100 million worth of the UST stablecoin from LFG.

Avalanche stated that they made their Twitter announcement primarily because “some members of the Avalanche Community have inquired about details around the AVAX reserves.”

The AVAX tokens held by TFL and LFD represented about 0.5% and 0.9% of the token’s weekly volume. FTL’s tokens are subject to a one-year lockup.

Crypto traders have also started speculating about possible plans for the AVAX tokens, as well as what the impact on the market might be if the tokens are to be sold.

Avalanche making this announcement could also be because entities with strong ties to the Terra ecosystem are facing pressure to be more transparent, following the chaos in the markets last week.

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