TerraForm Labs co-founder and Do Kwon‘s business partner, Daniel Shin, was accused of committing fraudulent acts.
TerraUSD and LUNA tokens, which experienced a huge loss in value at the beginning of May, lost almost all of their value in just three days. The UST, which was designed as an algorithmic stablecoin, lost its 1:1 constant and caused huge losses to investors. Despite all these negative developments and great backlash, Do Kwon and TerraForm Labs continued as if nothing had happened and closed the old ecosystem by releasing LUNA 2.0. The South Korean government, on the other hand, takes things very seriously and continues two investigations.
Terraform Labs The accusations that the administration had prior knowledge of the collapse were on the agenda on social media. Also, Twitter user ‘FatManTerra’ has filed multiple accusations against Do Kwon and Daniel Shin alleging that the duo has made millions with LUNC.
Terra’s web of lies is slowly unraveling, and we’re getting an increasingly clear picture of the whole truth with every day that goes by. We are mapping out who was involved, where the money went, and how the scam was allowed to happen. Everything will come out in time. (1/5)
— FatMan (@FatManTerra) June 8, 2022
In addition, about 81 investors from South Korea filed a complaint against Terraform Labs with the Seoul Southern District Attorney’s Office. The reasons for the accusation were “The Terraform founders and the company deceived investors with their flawed algorithmic money”.
TerraForm Labs Co-Founder Reveals Accusations
Daniel Shin He eventually spoke out about the charges and denied that Terraform Labs management had any prior knowledge of the collapse. Speaking to the Financial Times, Shin explained that he has no intention of manipulating the price of TerraUST. He also stated that his team was not deceitful and answered every question asked of them as they went down to $0.
“Our sole aim was to renew the payment settlement system with blockchain technology. We were not aware of any flaws in the coins algorithm and made no attempt to manipulate their price.”
Do Kwon, on the other hand, did not speak up about being accused of fraud and mostly chose to remain silent. Do Kwon recently made his Twitter account ‘private’, making it difficult for others to contact or question him. Kwon is now believed to be in Singapore, not South Korea.
Terra CEO Do Kwon has made his Twitter account private. pic.twitter.com/CptTA84qNY
— Watcher.Guru (@WatcherGuru) June 7, 2022
At the time of writing, Luna 2.0 was trading at $3.13 and was down 10.3% in the 24-hour trading hour. You can follow the current price action here.
Disclaimer: What is written here is not investment advice. Cryptocurrency investments are high-risk investments. Every investment decision is under the individual’s own responsibility. Finally, Koinfinans and the author of this content cannot be held responsible for personal investment decisions.