The whereabouts of Terra’s $3.5 billion Bitcoin reserve set up to back the UST stablecoin remains a mystery days after the collapse of Terra’s LUNA and the stablecoin. The funds became untraceable after being moved to two crypto platforms.

The $18.3 billion Grayscale Bitcoin Trust (GBTC) fund has seen its market discount widen to an all-time low of 30.79% over the past week as crypto markets suffered one of their most volatile periods in recent times.

The president of El Salvador, Nayib Bukele, has revealed that 44 countries are set to meet in El Salvador to discuss bitcoin among other things including financial inclusion, banking the unbanked, and a digital economy.

Sponsored: In 2017, Invictus set out to fundamentally change the asset management industry. Invictus' officially regulated funds are now institutional-grade products with industry-leading fees and very accessible minimum requirements.

Top stories in the Crypto Roundup today:

• Whereabouts of Terra’s Bitcoin Reserves Remain a Mystery
• Grayscale Bitcoin Trust Discount Hits New All-Time Low
• 44 Countries to Meet in El Salvador to Discuss Bitcoin
• Exploring UST’s Fall From Grace
• Sponsored: Invictus Capital spearheads the world's first regulated and tokenised mutual fund

Whereabouts of Terra’s Bitcoin Reserves Remain a Mystery

The whereabouts of Terra’s $3.5 billion Bitcoin reserve set up to back the UST stablecoin remains a mystery days after the collapse of Terra’s LUNA and the stablecoin. The funds became untraceable after being moved to two crypto platforms.

According to blockchain forensics firm Elliptic, the Luna Foundation Guard (LFG) accumulated $3.5 billion in Bitcoin between January and March of this year. When the value of the UST stablecoin fell below its peg on May 9, the LFG said it would use the BTC to purchase UST and defend the peg.

Over the next day, the crypto wallets used to hold the reserves were emptied. On May 9, nearly $1.7 billion was sent from LFG wallets to a new address through two transactions after Terra’s co-founder, Do Kwon, said the funds would be used to support the peg.

Within hours, the entire amount was moved to a single account on the Gemini exchange through several transactions. Per Elliptic, it was not possible to trace the assets from that point.

The remaining Bitcoin reserves were moved on May 10 in a single transaction to Binance. Whether the funds were sold isn’t clear. Do Kwon has said the funds were lent to market makers to defend the stablecoin’s peg.

Grayscale Bitcoin Trust Discount Hits New All-Time Low

The $18.3 billion Grayscale Bitcoin Trust (GBTC) fund has seen its market discount widen to an all-time low of 30.79% over the past week as crypto markets suffered one of their most volatile periods in recent times.

Each share of GBTC holds 0.00092455 BTC, which at the time of writing is worth $27.28. Each GBTC share is currently trading at $19.7, meaning the discount is currently 27.78%. Late last week, each GBTC share’s holding was equivalent to $26.46, while the fund was trading at $18.35 a share.

GBTC is one of the only ways for stock traders in the U.S. to gain exposure to the movements of the flagship cryptocurrency directly, without actually investing in BTC. For years the fund traded at a premium to the underlying BTC price, but it turned negative in early 2021.

The fund’s premium turned into a discount at the time of the launch of the first spot-based exchange-traded fund (ETF) om Canada, which gave investors an alternative vehicle to gain exposure to BTC.

44 Countries to Meet in El Salvador to Discuss Bitcoin

The president of El Salvador, Nayib Bukele, has revealed that 44 countries are set to meet in El Salvador to discuss bitcoin among other things including financial inclusion, banking the unbanked, and a digital economy.

In a tweet, Bukele wrote that the 44 countries will be represented via 32 central banks and 12 financial authorities. The countries represented are primarily developing nations including Nigeria, Egypt, Nepal, Pakistan, Bangladesh, Kenya, Uganda, Paraguay, Angola, Guinea, and Madagascar.

The full agenda of the meeting is unclear. El Salvador became the first nation to adopt Bitcoin as legal tender last September. The country holds over 2,000 BTC on its balance sheet, having added 500 coins to its treasury this month.

Exploring UST’s Fall From Grace

The recent blowup of Terraform Labs’ ecosystem has been one of the most impactful events in the history of crypto, comparable to the collapse of Mt. Gox in 2014 and other sharp market crashes like the one seen in March 2020.

Since May 8^th, UST’s peg has fallen to a low of $0.078 before recovering slightly to trade at $0.143 at the time of writing, and LUNA’s market capitalization plunged from $41.2 billion to $6.6 million, the largest destruction of wealth in such a short amount of time in a single project in crypto’s history.

Moreover, over 6 trillion new LUNA tokens have been minted, which diluted the cryptocurrency’s price down to $0.00023.

Find out more via CryptoCompare’s latest report on UST’s fall from grace.

Invictus Capital spearheads the world's first regulated and tokenised mutual fund

Invictus Capital has become the world’s first fully regulated, tokenised, and administered mutual fund in the world.

In 2017, Invictus set out to fundamentally change the asset management industry. Invictus' officially regulated funds are now institutional grade products with industry leading fees and very accessible minimum requirements.

Invictus fund tokens now represent legal ownership of the underlying fund shares and a wide range of benefits are now available:

• In the new fund structure, tokens represent shares of the mutual funds, providing investors with security and peace of mind.

• An independent board of directors has been appointed, ensuring a strong corporate governance system.

• Fund assets and the financial health of the funds are verified regularly by independent external auditors.

• Fully compliant with global AML and KYC regulations.

Disclaimer:

Cryptocurrency trading involves high risk, and is not suitable for all investors. Before deciding to trade cryptocurrencies, tokens or any other digital asset you should carefully consider your investment objectives, level of experience, and risk appetite.

Its content does not constitute financial advice. Please remember that the value of investments, and any income from them, can fall as well as rise so you could get back less than you invest. If you are unsure of the suitability of your investment please seek advice.

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