As the broader cryptocurrency market shows signs of recovery, LUNA and AVAX posted double-digit gains over the last 24 hours.
LUNA, the native cryptocurrency of the DeFi-centric Layer 1 blockchain protocol Terra, is among the market’s top gainers as its value soared by an impressive 15.1% in the last 24 hours.
The ninth-largest crypto asset in terms of market capitalization, LUNA is currently changing hands at $57.23, although the token is still down by nearly 1% over the past week, per CoinMarketCap.
LUNA’s gains appear to be spurred by the news of the Luna Foundation Guard (LFG), a non-profit organization supporting the Terra network, raising $1 billion through a token sale led by Singapore-based hedge fund manager Three Arrows Capital.
According to LFG, the funds will be used to create a Bitcoin-denominated UST Forex Reserve, a financial vehicle described as “a release valve” for the redemptions of Terra’s UST stablecoin into LUNA.
In other words, LFG will be able to use the Bitcoin reserves to stabilize the market in cases of sell-offs, with Nicholas Platias, founder of Chronos Finance, claiming that “with the UST Forex Reserve, the primary counter-argument for the sustainability of algorithmic stablecoins is eliminated.”
Avalanche breaks into Top 10
Meanwhile, Avalanche (AVAX) has also seen some strong performance in the last day, flipping the Binance USD (BUSD) stablecoin to become the 10th largest digital currency by market cap.
As data from CoinMarketCap shows, AVAX is up 13% over the day to the current value of just over $79.
While it’s not immediately clear what’s behind the latest price action, AVAX recently saw increased demand from institutional investors, according to a new report by CoinShares.
Per the report, Avalanche was the second-biggest performer behind Bitcoin in the week ending February 21, with inflows into digital asset funds supporting AVAX totaling as much as $25 million.
Elsewhere. the price of Bitcoin (BTC) is up 4.67% over the day, with the leading cryptocurrency trading at just over $38,850.
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