How did Luna get so many Bitcoins?, How would a US recession affect Bitcoin’s price?, MIT specialist: “The world needs Bitcoin”

Written by Pedro Lopez

May 7, 2022

How did Luna get so many Bitcoins?

On May 5th, the Luna Foundation bought the Bitcoin equivalent to $1.5 billion to back up its known stablecoin, U.S Terra. Globally, the organization claims to have 80,373 BTC, almost $3 billion

After rumors about how Luna positioned itself in the Top 10 Bitcoin holding companies, Terra’s founder explained that they initially had $3 billion at their disposal, of which $1 billion was recently raised from investors and another $1.2 billion was raised by the foundation by selling UST in exchange for USDT. The remaining USD 800 thousand dollars were kept in LUNA.

The rest of the money will be obtained from arbitrage (the difference between the cost of issuing a currency and its nominal value).

How would a US recession could affect Bitcoin’s price?

The economic history of the United States has 2 devastating chapters; one in 1929 (The Great Depression) and one in 2008 (The Great Recession). These financial catastrophes left the country submerged in poverty and an unfortunate number of suicides. Bitcoin was born as a refuge in these scenarios.

However, the Federal Reserve’s measures have affected the price of Bitcoin along with traditional markets, causing panic to grow among investors.

This year, Bitcoin began to be considered as a risk asset and is highly speculated among companies with large capital flows, which negatively influences its price.

Ironically, a financial crisis in the United States may be the escape Bitcoin needs from corporate speculation and regulatory measures, as it would once again be considered a safe haven.

MIT specialist: “The world needs Bitcoin”

As the adoption of cryptocurrencies increases, a lot of awareness has emerged about the advantages of a peer-to-peer system, leaving the middlemen aside.

The specialist André Neves explained the importance of this technology during a talk included in the ninth edition of the MIT Bitcoin Expo. The event was held in person at the Massachusetts Institute of Technology (MIT).

Neves stated:

“This is one of the most important properties of money: the ability to trade freely with others who value it equally. A world where local money is not interoperable is not the world we want to live in”

The specialist ended the conference by defining Bitcoin as the model on which the future of the economy should be based, thus expressing the world’s need for Bitcoin.

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