U.S. Law Enforcement Authorities Begin Investigation into 'Terra Luna Crash Incident' (1 Viewer)

[GENE_NEWS]

U.S. Law Enforcement Authorities Begin Investigation into 'Terra Luna Crash Incident'

Entered2023.03.14. at 10:14 AM Original article


Reporter Kyungmi Choi


U.S. law enforcement authorities have launched an investigation into the CEO of Terraform Labs, a key figure in the virtual asset TerraUSD (UST) and Luna crash, the <Wall Street Journal (WSJ) reported on >the 13th (local time).

CEO of Kwon Do-hyung Terraform Labs. (Photo=Yahoo Finance Video Capture)


Citing sources familiar with the matter, the WSJ reported that the Federal Bureau of Investigation (FBI) and the U.S. Attorney's Office for the Southern District of New York have summoned former employees of Terraform Labs, which issued Terra and Luna, to investigate over the past few weeks. Law enforcement authorities are reportedly investigating the connection between Chai, a South Korean payment application (app) that was linked to Terra, and the Terraform blockchain.


The WSJ said it was unclear what specific charges law enforcement would bring against Kwon, and it was possible that authorities would drop the investigation without charging him.
Terra is a stablecoin designed to peg 1 tera value to 1 dollar. However, in May last year, Terraga's related systems went inoperable, resulting in a massive sell-off.

Since then, Terra prices have crashed within a week, and more than $5 billion in market capitalization has evaporated, causing huge losses for individual and institutional investors.

Since then, Terra prices have crashed within a week, and more than $5 billion in market capitalization has evaporated, causing huge losses for individual and institutional investors.

The SEC filed a lawsuit in Manhattan federal court, accusing Kwon and Terraform Labs of misleading investors about the risks of TerraUSD, a stablecoin.

The SEC alleged that Terraform Labs stated that Chai Payments and Terraform's blockchain were linked, but that was not the case and that it was deceiving investors into buying its virtual assets.

Terraform Labs and Justice Department officials did not respond to the WSJ's request for comment.

South Korean prosecutors issued an arrest warrant for Kwon in September last year on suspicion of violating the Capital Market Law.

Kwon is currently red-wanted, the highest level wanted by the International Criminal Police Organization (Interpol).

Domestic investigators believe he fled to Serbia from Singapore, where he had been staying earlier. Kwon posted that "I never tried to hide" and claimed that he worked to the end to defend Terra's plummeting values.

Kyungmi Choi ([email protected])

Reporter Kyungmi Choi

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[seungfloral]

I wonder what will be the result