Although the reason behind the transfer is not very clear, LFG earlier announced that it is set to move assets toward direct custody to enhance the fund’s security.
By Temitope Olatunji
Edited by Julia Sakovich
Updated
3 mins read
Luna Foundation Guard (LFG), an organization known for its role in supporting the Terra ecosystem, has sparked speculation within the cryptocurrency community after its sudden transfer of digital assets worth $94.7 million. The breakdown of the transfer includes 1.974 AVAX tokens, valued at $71.21 million, and 39,499 BNB tokens worth $23.33 million to an unmarked address.
The sudden transfer of funds has resulted in various speculations. It has raised eyebrows that the movement could be part of a strategic reallocation of assets in preparation for upcoming events, or perhaps the organization is exploring new partnerships or collaborations that may require the relocation of these digital holdings.
Although the reason behind the transfer is not very clear, LFG earlier announced on May 28 on its X page that it is set to move assets toward direct custody to enhance the fund’s security. This move involves transitioning assets held in the company’s multi-signature wallets to a more secure direct custody solution. The organization promised the public that all funds would remain trackable on the LFG Reserves dashboard. The firm stated:
“To enhance the security of LFG funds, LFG_org is set to transition assets held in LFG multi-sig wallets to a robust direct custody solution in the coming days…To maintain transparency and traceability, LFG funds will remain trackable on the LFG Reserves dashboard.”
Moreover, this sudden transfer coincided with a settlement report between Do Kwon, the founder of TerraForm Labs, and the United States Securities and Exchange Commission (SEC). According to the court records, it was revealed that the parties have agreed to a tentative settlement, with the final terms expected to be submitted to the court by June 12.
The SEC has previously requested a $5.3 billion penalty on Do Kwon and Terraform for fraud and misleading investors, but the defendants are arguing for a much smaller penalty of $1 billion and are seeking to dismiss part of the SEC request, as Kwon has denied any wrongdoing.
While it remains unclear whether the LFG’s recently transferred $95 million is directly related to the settlement deal, the crypto community will be keeping a close eye on the development and looking forward to more clarity about the situation.
Amid the speculation surrounding the fund transfer, the price of LUNA spiked by over 15% in the last 24 hours, and more than 35% on May 30 alone, breaking out of an accumulation phase that started on April 14. If the price is able to successfully retest the broken resistance, we expect to see a continued bullish rally to around $0.8, which will represent a 20% spike from its current price. However, it is expected that you carry out due diligence before banking on the price direction of any token.
Disclaimer: Coinspeaker is committed to providing unbiased and transparent reporting. This article aims to deliver accurate and timely information but should not be taken as financial or investment advice. Since market conditions can change rapidly, we encourage you to verify information on your own and consult with a professional before making any decisions based on this content.
Temitope is a writer with more than four years of experience writing across various niches. He has a special interest in the fintech and blockchain spaces and enjoy writing articles in those areas. He holds bachelor's and master's degrees in linguistics. When not writing, he trades forex and plays video games.
