JS Held conducted a detailed audit, which did not show any misuse of funds.
An audit report was published by JS Held, where it disclosed the results of the technical audits conducted on the trades, blockchain records, etc., of Terraform Labs (TFL) and The Luna Foundation Guard (LFG) and efforts by the two to defend the rates of TerraUSD (UST) which had witnessed market sell offs in May.
The two organizations had engaged the auditing firm to conduct the audits after reports and allegations had emerged on social media where LFG funds were reported to be misused. Questions were raised on LFG holding funds other than the amounts in its publicly declared wallets.
The audit report concluded that LFG had spent $2.8 billion to defend the UST’s peg and had also spent millions from its own reserves to defend the UST. All the funds were reportedly used to maintain UST’s rate with the dollar. This quashes all the allegations against TFL and LFG since all transactions occurred in the open markets without benefiting any insiders, while the report found the accusation of the ‘embezzlement of funds’ to be untrue.
“We hope that this report shows our organizations’ commitment to transparency and the wider crypto ecosystem, and we are more committed than ever to learn from our failure and continue to build systems that are more transparent, decentralized, and resilient.”, Do Kwon, the founder of Terraform Labs has reportedly stated.