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Do Kwon 🌕
@stablekwon
2/ First, *LFG is not trying to exit its bitcoin position*. The goal is to have this capital in the hands of a professional market maker such that: 1) Buy UST if price < peg 2) Buy BTC if price >= peg thus significantly strengthening the liquidity around UST peg
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Do Kwon 🌕
@stablekwon
3/ While buys and sells of UST are not meaningfully directional now, we felt it was valuable to have capital ready to be deployed in the current market. As markets recover, we plan to have the loan redeemed to us in BTC, increasing the size of our total reserves.
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Do Kwon 🌕
@stablekwon
5/ While this did not happen, allowing BTC to be redeemed against US on an onchain dex, we are just a few weeks away from a testnet launch developed by the
@astroport_fi
team. Until then, the LFG council decided to err on the side of caution.
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Do Kwon 🌕
@stablekwon
7/ This will be an important opportunity for the terra and wider crypto community to gather empirical data on how LFG operates & fits into the Terra ecosystem. Observe over the next few days not on whether LFG chose to deploy reserves, but on how.
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