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Terra's Founder Is Betting Millions on LUNA Holding its Highs

Do Kwon has placed a $1 million bet on the future price performance of his own project.

Terra's Founder Is Betting Millions on LUNA Holding its Highs
Shutterstock cover by pinkfloyd yilmaz uslu

Key Takeaways

  • Terraform Labs CEO and founder Do Kwon has accepted a $1 million bet that the price of Terra's LUNA token will be higher than $88 in one year.
  • The wager was initiated by pseudonymous crypto investor Sensei Algod late Sunday. Both parties have sent $1 million to UpOnly podcast host Cobie.
  • Kwon has also accepted a $10 million bet under the same conditions with another pseudonymous crypto investor, Gigantic Rebirth, but it is yet to become effective.

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Terraform Labs CEO and founder Do Kwon has bet $1 million that the price of Terra’s LUNA token will be higher than $88 on Mar. 14, 2023. 

Terra’s Do Kwon Bets on LUNA

Terra’s Do Kwon is placing a big bet on LUNA. 

The Terraform Labs CEO and founder and high profile crypto trader Sensei Algod have made a public wager on the future price performance of Terra’s native token LUNA. 

Sensei Algod initiated the wager late Sunday by making a public offer to bet anyone $1 million that the price of LUNA would be lower than it was at the time of the proposal in one year (it was trading at $88 at the time). “Who wants to take a $1000000 bet that $luna will be a lower price in 1 year than now?” they said on Twitter, tagging Do Kwon and two other well-known Terra believers. Kwon agreed to the bet shortly after. 

“Cool, I’m in,” he responded, even later doubling down on the offer by saying that he would prefer if they had made the bet on 90% of Algod’s net worth—a sum presumably larger than one million dollars. However, today both parties agreed to the bet’s terms and each sent $1 million in USDT to an escrow wallet managed by the popular crypto personality and UpOnly podcast host Jordan Fish, who operates under the alias Cobie.

Per the agreement, if the average 24-hour price of LUNA is higher than $88 on Mar. 14, 2023, Cobie will send the money to Kwon, and if it’s not, he will send it to Sensei Algod. 

Sensei Algod is one of many prominent crypto investors to have taken shots at Terra in the past, decrying the project as a “Ponzi.” The criticism typically focuses on Terra’s tokenomics design, which uses LUNA as the main stabilizing mechanism for the UST stablecoin. 

Terra critics say that due to how the peg stabilizing mechanism works, LUNA is at risk of entering a so-called death spiral where increasing amounts of it must be burnt to maintain UST’s peg. A LUNA death spiral would then also theoretically cause the UST stablecoin to de-peg permanently. To preserve the UST peg, the Luna Foundation Guard recently raised $1 billion to form a Bitcoin-denominated reserve for the stablecoin. 

Kwon is confident that LUNA won’t crash and is willing to bet significant sums of money that the Terra critics are wrong. In addition to the bet on LUNA’s price performance, Kwon also contested Sensei Algod to another one million dollar wager that UST would not de-peg by Mar. 14, 2023. “I shall even give you 2:1 odds,” he said, challenging Algod to take the bet.

A few hours after agreeing to the bet with Sensei Algod, Kwon also accepted a $10 million bet with the same conditions as the Sensei Algod bet with a trader popularly known as Gigantic Rebirth. Kwon said that he would match a $10 million bet if Gigantic Rebirth funded Cobie’s escrow wallet. However, Gigantic Rebirth is yet to send the money at press time.

Regardless of the outcome of the bets, Kwon promised to donate $1 million to Angel Protocol—a Terra-based protocol for creating perpetual charity endowments—and spend $1 million more on buying and burning Terra-based coins. “Not in it for the money,” he said.

Terra is currently trading at $92.63 with a market cap of $34.5 billion. It’s up 17.1% in the last week.

Update: The escrow wallet has now also received 10 million USDC. Gigantic Rebirth also posted an update on Twitter stating that they had sent the funds, though Do Kwon is yet to add the additional $10 million for his side of the bet.

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