Elliptic, a well-known blockchain analytics and intelligence firm, released a report explaining the situation regarding Luna Foundation.
The report highlighted how LFG’s Bitcoin stash was bought to collateralize the UST stablecoin. The project purchases around 80,000 Bitcoin in 2022 until May, increasing its UST reserves exponentially.
Ever since the Terra ecosystem collapsed recently, many projects have been trying to figure out what happened to its 3.5 billion worth of BTC. One announcement regarding the situation came when the NPO formed to help the Terra ecosystem commented on the situation.
The NPO stated that they would buy 10 billion dollars of BTC and other cryptos to support UST. However, all this changed recently.
The latest report by Elliptic stated that over 80,000 Bitcoin were moved to Gemini and Binance. The LFG announced on May 9th that it would be loaning 750 million dollars worth of BTC to OTC (over-the-counter) trading firms.
The same would be used to secure the UST stablecoin peg. At the same time, 22,189 Bitcoin was released from a BTC address linked with Luna Foundation Ground to a new account. A few hours passed when another 30,000 Bitcoin was shared from other LFG wallets to the same address.
Once these addresses were tracked, Elliptic found that over 52,198 Bitcoin was shared with a wallet at Gemini. These transactions took place within hours of the other trades, and the remaining 28,205 Bitcoin was also shared with a wallet at Binance on May 10th.
Elliptic stated that further tracing these assets is not possible, and thus, the identity or purpose of these transactions cannot be figured out. They concluded by stating that anyone trying to recover UST losses must determine whether the BTC holds remained in these exchanges.
Even the Terra team went public with their assessment, promising analysis of the situation. However, no further updates have been released by them on the situation.