SEC and South Korea Investigate Terraform Labs for Fraudulent Transactions

The SEC and South Korea Join Forces to Investigate Terraform Labs

– The SEC and the South Korean government are increasing their investigation efforts on Terraform Labs, the company behind Terra blockchain and Terra USD stablecoin.
– The SEC has been granted permission to collaborate with South Korea to gather more evidence and question Daniel Shin, the Co-founder of Terraform Labs.
– The SEC’s decision to align with South Korea is based on their intention to gather valuable evidence from Chai Corp, a South Korean financial services company owned by Shin.
– The termination of the relationship between Terraform Labs and Chai Corp in 2020 has become an important part of the SEC’s investigations.
– The SEC has filed a lawsuit against Terra and former CEO and Co-founder of Terraform Labs, Kwon Do-Hyung, alleging that the Terra collapse was aggravated by Do-Hyung’s illegal crypto scheme.

Do Kwon’s Arrest and Imprisonment in Montenegro

– In September 2022, South Korean Regulators issued an arrest warrant for Do Kwon after his whereabouts were unknown.
– In 2023, it was confirmed that Do Kwon was traveling under a false identity using falsified documents in Montenegro.
– Do Kwon was arrested and jailed for four months by the Montenegro court after being found guilty of traveling with fake documents.
– Do Kwon claimed he was given the fake documents by a third party but declined to identify them.
– Two Costa Rican passports, two identity cards, and two Belgian passports belonging to Do Kwon and a Terra Executive, Hang Chang-Joon, were confiscated as evidence.

Hot Take: The Investigation into Terraform Labs Continues

The collaboration between the SEC and South Korea shows the seriousness of the investigation into Terraform Labs and its alleged market manipulation and fraudulent transactions. With Do Kwon now facing legal challenges from both South Korean and US prosecutors, it is clear that global regulatory bodies are determined to uncover the truth behind the collapse of Terra and hold those responsible accountable. The outcome of this investigation will have significant implications for the future of the cryptocurrency industry and the measures taken to prevent similar incidents in the future.