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- Terra Founder Do Kwon recently expressed his views on Bitcoin and UST.
- He highlighted that he is betting on the long term growth of Bitcoin price and is not really worried about the short term volatility.
- The treasury, known as Luna Guard Foundation (LGF), aims to make Terra the largest single wallet holder of BItcoin.
Do Kwon, Founder of Terra (LUNA), has acknowledged that if the Bitcoin price crashes, it might have a negative impact on the price stability of the stablecoin UST. But he also expressed his expectations of BItcoin going up.
Terraform Labs is the company behind the popular Terra (LUNA) blockchain network that is willing to buy a total of $3 billion as a reserve for UST.
Kwon earlier highlighted his views about Terra protocol’s decentralized stablecoin $UST. He expressed that it will be the first internet native currency to carry out a Bitcoin standard in its monetary policy.
Recently he expressed his views in an interview on the Unchained podcast when the host Laura Shin asked him what would be the short term implications of holding so much BTC for the stability of UST.
He highlighted that the worst case would be if they were buying bitcoin and a crash happened after six months, and it’s correlated with the massive fall in demand for UST, which would be negative.
Further adding that he is sort of betting that the long term scenario of BTC going up and the reserves being strong enough to withstand UST demand drops is the more likely scenario.
The Terraform Labs CEO has been buying Bitcoin to hold in Terra’s treasury as 40% of the collateral for the UST coin. Recently Terra bought 2,493 BTC, and it has acquired 30727.9 BTC to date. Making Terra the third-largest single wallet Bitcoin holder.
Kwon also noted an aim for the treasury known as Luna Guard Foundation (LGF) is to make Terra the largest single wallet holder of BItcoin. It is to note that currently, Michael Saylor’s MicroStrategy is the firm that tops the listicle of BTC holders. And to replace it, Kwon needs to acquire a massive number of BTC holdings.
Kwon noted that Terra is a Layer 2 solution for the Bitcoin network when talking about Terra. He argued that with Terra, Bitcoin has a bridge that facilitates it to be utilized across several applications from NFTs to DAOs to DeFi. And that in terms of the expressivity, the transaction capabilities, the throughput, all those things can happen on Terra.
Terra is a Proof-of-Stake blockchain protocol and a next-generation smart contracts platform that merges decentralized finance with the concept of Stablecoins. Terra’s native token is LUNA, which is utilized to keep an algorithmic stablecoin peg to the US Dollar.
Andrew is a blockchain developer who developed his interest in cryptocurrencies while pursuing his post-graduation major in blockchain development. He is a keen observer of details and shares his passion for writing, along with coding. His backend knowledge about blockchain helps him give a unique perspective to his writing skills, and a reliable craft at explaining the concepts such as blockchain programming, languages and token minting. He also frequently shares technical details and performance indicators of ICOs and IDOs.
