Pantera Capital did not suffer significant losses due to Terra (LUNA)’s collapse last week. The crypto venture capital firm says that long before the crash, it cashed about 80 percent of its investment in stablecoin UST in the LUNA ecosystem, and actually made a huge profit throughout the crash. Here are the details…
Pantera Capital pre-sold USTs
One of the high profile backers of Terraform Labs, as reported by Cryptokoin.com Pantera Capital, a company, liquidated about 80 percent of its Terra (LUNA) investment long before TerraUSD (UST) crashed last week. Joey Krug, co-investment officer at Pantera Capital, said, “There were mostly bubbles in the market over the last year, so we exited most of our position before the collapses. “We’ve been selling about 80 percent over the past year, pretty slowly over time,” he said.
Pantera Capital has invested in Terraform Labs at least twice. It once supported its $25 million round in January 2021 and then joined the $150 million ecosystem fund round in July 2021. Krug explained that Pantera’s LUNA investments are separate from Terraform Labs’ investments. Krug used the following statements:
We have driven this position down over time as it has become increasingly profitable/large to maintain a diversified portfolio. We initially invested in LUNA because of the progress we’ve seen in developer adoption, use of payments, and the broader ecosystem built on Terra.
Significant profit was made with the sale of LUNA
Pantera said that they made a significant profit as they left most of their investment early. Paul Veradittakit, partner at Pantera Capital, said the company turned $1.7 million into about $170 million. Meanwhile, other venture capital firms backing Terraform and Terra’s native LUNA token are suffering losses as they lost almost all of its value due to the UST collapse.
UST algorithmic stablecoin dropped sharply to levels below 10 cents last week, far from its target price of $1. It still trades at that level. Meanwhile, LUNA faced a loss of over 100 percent. Pantera sold most of the LUNA shares out of the remaining 20 percent investment when it noticed UST’s departure from the US dollar peg last week.
