Avalanche

The <a href="https://www.blockhead.co/tag/avalanche/" rel="noopener noreferrer nofollow">Avalanche Foundation</a> has announced a deal to repurchase 1.97 million AVAX tokens from <a href="https://www.blockhead.co/tag/terraform-labs" rel="noopener noreferrer nofollow">Terraform Labs&#39;</a> bankrupt estate.Luna Foundation Guard (LFG) purchased $100 million worth of Avalanche&#39;s AVAX tokens to strengthen its reserves back in April 2022, one month before the collapse of the <a href="https://www.blockhead.co/tag/luna" rel="noopener noreferrer nofollow">Terra ecosystem</a>. The agreement is pending court approval.&#34;This action ensures that LFG would not violate the original agreement’s restrictions on the tokens’ use and shields the tokens from the complexity of a bankruptcy trustee liquidation, while returning 1.97M AVAX to the Foundation’s holdings,&#34; Avalanche explained.&#34;This further enhances the Foundation’s ability to support the ongoing growth and development of the Avalanche ecosystem.&#34;The current value of the tokens is approximately $56 million, down 44% from the initial $100 million value.Last month, <a href="https://www.blockhead.co/tag/do-kwon" rel="noopener noreferrer nofollow">Do Kwon&#39;s</a> Terraform Labs received court approval to wind down its operations in a bankruptcy agreement.On 19 September, a US Bankruptcy Judge Brendan Shannon approved Terraform’s bankruptcy plan, describing it as a “welcome alternative” to further litigation.The Singapore-incorporated company had faced a lawsuit for defrauding cryptocurrency investors who lost $40 billion when <a href="https://www.blockhead.co/tag/" rel="noopener noreferrer nofollow">Luna</a> crashed in 2022.Terraform Labs filed for bankruptcy in January and reached a settlement agreement with the U.S. Securities and Exchange Commission (<a href="https://www.blockhead.co/tag/sec" rel="noopener noreferrer nofollow">SEC</a>) for a staggering $4.5 billion.Collapse of UST and LunaThe Terra ecosystem, spearheaded by Terraform Labs, experienced a spectacular collapse in May 2022. UST, an algorithmic stablecoin designed to maintain a 1:1 peg with the US dollar, lost its peg and plummeted in value.This triggered a domino effect, causing the price of Luna, the ecosystem&#39;s utility token, to spiral downwards towards near worthlessness. The crash resulted in billions of dollars in losses for investors and the start of a long crypto winter for the rest of the industry.News of the repurchase sent <a href="https://www.blockhead.co/tag/avax" rel="noopener noreferrer nofollow">AVAX</a> up more than 15% from around $25 to almost $29.<img src="https://academy-public.coinmarketcap.com/optimized-uploads/859d477ff8e341ad8d67514befe00a70.png" />

Avalanche Foundation to Repurchase 2M AVAX From Terra’s Luna Foundation Guard

Blockhead

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