Terra Eyes Avalanche Purchase, as Its Bitcoin Reserves Hit $1.5 Billion
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Both Terraform Labs and the Luna Foundation Guard recently revealed plans to acquire $200 million worth of AVAX in two token swaps.
Over the past few weeks, Terra has steadily added over $1 billion worth of Bitcoin to its reserves as it aims at acquiring $10 billion worth of BTC to back its UST stablecoin. Terra now holds approximately 36,000 BTC worth over $1.5 billion, using the current exchange rate.
That said, Terraform Labs recently announced a collaboration with Avalanche that would allow it to swap $100 million worth of LUNA for the equivalent amount in AVAX. Shortly afterward, the Luna Foundation Guard (LFG) announced that it would make a similar move. This swap will make AVAX the “first major crypto-asset besides BTC to be added to the UST reserve.”
The Terra team has said that this collaboration is the start of a “diversified and non-correlated asset pool supporting the UST peg.”
Terra CEO Do Kwon provided some clarity on the collaboration with Avalanche, calling it “one of the most exciting ecosystems in web3.” The CEO explained that LFG’s AVAX swap would go into backing the UST as a reserve using the automated mint mechanism already in place for its Bitcoin holding.
Key Terra Levels to Watch — April 8
Following a strong performance over the past few weeks, which climaxed with LUNA peaking at $119.55 on Tuesday, the cryptocurrency has recorded a sharp correction near the $100 price point as the broader market retraces.
This correction led to a breach below the 4-hour 100 EMA, indicating a return to bearish conditions. However, the price has extended deep into oversold conditions on my momentum indicators. That said, a bearish continuation below the $100 psychological mark is unlikely at the moment, given the prevailing market conditions and the presence of my multi-week-long ascending trendline.
However, I do not expect a bullish reversal anytime soon and foresee a sideways pattern between $100 and $110 into next week.
Meanwhile, my resistance levels are $104.00, $110.00, and $115.00, and my support levels are $100.00, $96.00, and $90.00.
Total Market Capitalization: $2.02 trillion
Terra Market Capitalization: $36 billion
Terra Dominance: 1.78%
Market Rank: #9
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