After Luna Foundation Guard publishes audit report, will it affect LUNC/USTC increase?
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- Luna Foundation Guard announced a third-party technical audit on November 16
- The audit confirmed Terraform Labs and LFG were free of wrongdoing.
When Terra crashed, it caused billions of dollars in damage to the crypto world, both personally and institutionally. The Terraform co-founder has come under scrutiny by authorities in both the United States and South Korea.
Do Kwon has been under investigation for alleged mismanagement for a while. However, the Luna Foundation Guard (LFG) has just released a report that may provide more details on the events in question from a financial point of view. Could this be the catalyst to bring USTC and LUNA Classic back to life?
Luna Foundation Guard's Audit Report
Announcing the completion of the audit, the Luna Foundation Guard (LFG) released a statement on Nov. 16. Technical audit of LFG and Terraform Labs expenses during the LUNA/UST incident in May performed by JS Held, a third-party auditing firm.
The auditing firm said LFG spent $2.8 billion defending the UST split in a 31-page report published by JS Held.
The total amount spent to protect the UST peg includes 80,081 BTC and 49.8 million stablecoins, which the audit firm said were consistent with tweets by LFG on May 16, 2022.
It was also determined that the fund used more than $600 million of its cash to hedge the UST's collapse in addition to the money it spent.
Through access to on-chain data, the company can perform audits by looking at transaction records separately obtained from various crypto exchanges. According to the LFG, the main purpose of the audit was to put an end to rumors of money theft, insider trading, and freezing of law enforcement accounts.
The audit report seems to suggest that LFG and Terraform Labs made the right decision without malicious motives, but the jury still disagrees with that. But could LUNC and UST be affected by the report?
LUNC, UST price action
Daily analysis of the price movement of LUNC shows that the asset has been trending slightly lower lately. Before a downtrend is observed, all that can be seen is horizontal price movement.
LUNC is trading at approximately $0.00017 at the time of this writing. Compared to a gain of more than 6% in the previous trading period, this is a loss of more than 2%.
Minimal trading activity, indicating low interest in the asset, is also displayed on the Volume Indicator. Relative strength index (RSI) analysis shows that the asset is still moving strongly in a bearish direction. Below 40 and slightly above the oversold zone, the RSI line is visible.
The former stablecoin is far from regaining its fixation with the dollar, as the UST chart shows.
LFG's efforts to make LUNA/UST's collapse transparent could have a positive effect on asset values.
However, it is ultimately up to the user to decide if the information provided is enough or just a ruse to return them to a broken ecosystem.
The recent crash in the crypto industry could make it difficult to gain trust, and it may take some time for LUNC/UST to regain its footing, if at all.
Nov 17, 2022