Avalanche Foundation to Repurchase 1.97M Tokens Sold to Luna Before Ecosystem Collapse
Ruholamin Haqshanas is a contributing crypto writer for CryptoNews. He is a crypto and finance journalist with over four years of experience. Ruholamin has been featured in several high-profile crypto...
The Avalanche Foundation is set to repurchase 1.97 million Avalanche (AVAX) tokens that were sold to the Luna Foundation Guard (LFG) in April 2022, just one month before the Terra blockchain ecosystem collapsed.
The foundation has agreed to buy back the tokens for $45.5 million, although their current market value stands at $57.4 million.
The move is part of a settlement agreement filed in a Delaware Bankruptcy Court on Oct. 9, and is currently pending court approval, according to an Oct. 11 post by the foundation on X.
The foundation explained that this repurchase ensures LFG will not breach the original agreement’s terms regarding the use of the tokens.
It also protects the tokens from complications that could arise during a potential liquidation by a bankruptcy trustee.
By reacquiring the tokens, the Avalanche Foundation brings 1.97 million AVAX back into its own holdings.
The current value of the AVAX tokens is 42% lower than the $100 million LFG paid for them in April 2022.
The Avalanche Foundation has negotiated an agreement to repurchase all AVAX tokens previously sold to the Luna Foundation Guard (LFG) in April 2022, which is now awaiting approval from the Bankruptcy Court.
This action ensures that LFG would not violate the original…
Despite the price drop, Terraform Labs, the company behind the Terra blockchain, noted in its filing that the settlement will reduce litigation costs and preserve more assets for creditors.
The settlement price was calculated based on the volume-weighted average price of AVAX over a seven-day
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