New York, Saturday, November 09, 2024- The Avalanche Foundation has repurchased $52 million worth of AVAX tokens initially sold to the Luna Foundation Guard (LFG) in 2022.
The bankruptcy court granted Avalanche permission to reclaim 1.97 million AVAX tokens, marking the close of a chapter in Avalanche’s relationship with Terraform Labs, the blockchain project responsible for the now-collapsed TerraUSD (UST) stablecoin.
This buyback reflects Avalanche’s commitment to focus on its own ecosystem and distance itself from Terra’s turmoil, which affected many crypto stakeholders in 2022.
In the original agreement, Avalanche transferred $100 million in AVAX to LFG, while $200 million in UST and LUNA tokens were added to the Avalanche Foundation’s holdings. The collaboration aimed to create strategic alignment between the two ecosystems. However, the project fell apart when Terra’s algorithmic stablecoin UST collapsed, leading to significant market losses. Since then, Avalanche has worked to regain control of the AVAX tokens to reinvest them in its own projects, including ecosystem grants, incubators, and community events.
Avalanche Foundation also emphasized the buyback as a step towards advancing the foundation’s growth goals, stating the reclaimed funds will strengthen technological and community development efforts.
The move indicates renewed focus on sustainable development, distancing itself from previous associations as it pursues a strong, independent trajectory.
