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Terra developer to allocate more than $4 billion to develop project ecosystem

Terra developer to allocate more than $4 billion to develop project ecosystem

Terraform Labs, the company behind the Terra blockchain, will provide LUNA 50 million (more than $4 billion) in funding to the newly created Luna Foundation Guard (LFG), a nonprofit organization. LFG will focus on developing the project's ecosystem and enhancing the sustainability of the Terra USD (UST) stablocoin.

1/ The first step towards {REDACTED} is now complete. Introducing the formation of the Luna Foundation Guard (LFG).https://t.co/oqke82OUB2 pic.twitter.com/QKGwrhmtMH - Terra (UST) �� Powered by LUNA �� (@terra_money) January 20, 2022

LFG is overseen by an independent board of governors that includes industry experts and heads of cryptocurrency companies, including Terraform Labs CEO Do Kwon. Other members of the Terra ecosystem will join the organization in the future;

"LFG's main objective is to ensure the stability of UST pegging and to help develop the Terra ecosystem. Creating reserves that support the binding of algorithmic stablcoins in a volatile environment, as well as funding research that supports the further development of these assets," said in a statement.

The organization will also provide grants to developers, researchers and community members who "pursue the boldest ideas for the Terra economy." Applicants were divided into three categories:

open-source technology development; research and education; and community development.

Terraform Labs will transfer LFG 50 million LUNA as seed funding. The transaction is expected to be initiated on January 22. Its hash will be made publicly available to ensure transparency in the process.

Blockchain funds (TVL) in DeFi applications on Terra reached $18.64 billion, according to DeFi Llama. The blockchain protocol ranks second among the largest ecosystems in terms of metrics, behind only Ethereum.

Data: DeFi Llama.

UST Stablecoin's market capitalization has increased more than 5,000% in the past 12 months, reaching $10.86 billion, according to CoinGecko.

Recall that Terraform Labs raised $150 million in July 2021 from several large investors, including Arrington XRP Capital, Pantera Capital, Galaxy Digital and BlockTower Capital.

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