Judge Grants SEC Permission to Question Co-founder of Terraform Labs
A judge has approved the U.S. Securities and Exchange Commission’s (SEC) request to work with international authorities to question Daniel Shin, one of the co-founders of Terraform Labs. The SEC alleges that Terraform Labs and Do Kwon, another co-founder, deceived investors by misrepresenting the use of the Terra blockchain and its native token, LUNA. Kwon has already been sentenced to prison in Montenegro for passport forgery, and now faces extradition and multiple charges related to the $40 billion crash of the Terra ecosystem. South Korean authorities have also charged Shin with fraud.
Key Points:
– Judge Jed S. Rakoff granted the SEC permission to question Daniel Shin, co-founder of Terraform Labs, with the assistance of South Korean authorities.
– The SEC alleges that Terraform Labs and Do Kwon misled investors about the use of the Terra blockchain and the value of LUNA token.
– Kwon transferred 10,000 Bitcoin from Terraform Labs and the Luna Foundation Guard into a Swiss bank account as the TerraUSD UST stablecoin collapsed.
– Swiss authorities froze $26 million worth of assets last month at the request of the New York Attorney’s Office and the SEC.
– Kwon faces extradition and multiple charges in relation to the crash of the Terra ecosystem, while Shin has been charged with fraud in South Korea.
Hot Take:
The SEC’s permission to question Daniel Shin, along with the charges against Do Kwon and Shin, highlights the regulatory crackdown on deceptive practices in the crypto industry. This case serves as a reminder to crypto investors to exercise caution and conduct thorough research before investing in any project. Transparency and accountability are crucial for the long-term growth and credibility of the crypto space.
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