The Luna Foundation Guard (LFG), a non-profit organization built to support the Terra LUNA/USD system, has said that due to ongoing legal battles, it has not been able to pay back smallholders of its collapsed Stablecoin.
1/ Since $UST’s depeg in May, there has been understandable interest in LFG’s assets and how they will be distributed. As mentioned, our goal is to distribute LFG’s remaining assets to those impacted by the depeg, smallest holders first. https://t.co/VOTQDkQZ90— LFG | Luna Foundation Guard (@LFG_org) October 7, 2022
“Unfortunately, due to ongoing and threatened litigation, distribution is impossible. While these matters are outstanding, there can be no timeline established for resolution,” LFG said in the Twitter announcement.
Earlier in May, LFG promised to use its remaining holdings to compensate small UST holders.
“The Foundation is looking to use its remaining assets to compensate remaining users of UST, smallest holders first. We are still debating through various distribution methods; updates to follow soon,” it added.
Following LFG’s announcement, people started reacting to its intention to disperse the funds.
Excuses.— FatMan (@FatManTerra) October 7, 2022
May 9 - UST depeg
May 16 (7 days) - LFG commits to small holder refund
May 28 (19 days) - You launch an entire new blockchain & conduct a mass LUNA drop
June 21 (43 days) - First Terra lawsuit is filed
You had loads of time to do a simple USDC airdrop. Why didn't you?
However, LFG has said that it still intends to reimburse UST holders.
In September, LFG allegedly moved 3,313 Bitcoin BTC/USD, totaling more than $69 million, to two cryptocurrency exchanges outside South Korea.
But South Korean authorities were able to freeze part of the transferred Bitcoin since the alleged transfer.
Do Kwon, founder of the collapsed crypto Terra, has been issued an international arrest warrant over the collapse of his blockchain platform created by Terraform Labs and faces multiple criminal charges in South Korea.
© 2023 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Visit Benzinga's Crypto Homepage - 1,000,000+ depend on Benzinga Crypto every month