TerraForm Labs Founder Admits to Artificially Inducing Trading Volume
The founder of TerraForm Labs, Do Kwon, has confessed to artificially inflating trading volume on Terra’s blockchain, according to leaked chat records that have become evidence in the ongoing lawsuit brought by the U.S. Securities and Exchange Commission (SEC). The leaked conversation, which took place on Slack in September 2019, involves Do Kwon and co-founder Daniel Shin. The SEC is intensifying its investigation into the case, which includes allegations of defrauding investors through breaches of capital market laws and manipulation of cryptocurrency prices.
Leaked Chat Reveals Discussion of Fake Transactions
The leaked transcript shows Do Kwon suggesting the creation of fake transactions that would appear genuine. He states, “I can make fake transactions that just look real,” and expresses his intention to scale back these activities as Chai (Terra’s payment system) grows. In response to Shin’s concern about people discovering the deception, Do Kwon asserts his determination to make it indiscernible and playfully adds, “I won’t tell if you won’t,” accompanied by a wink emoji.
SEC Crackdown Following Terra Luna Fiasco
The SEC’s focus on cryptocurrency comes after the widespread impact of the Terra Luna controversy in 2022. This case is significant for providing resolution to crypto investors affected by the financial crisis that occurred that year.
Hot Take: SEC Lawsuit Exposes Manipulation Tactics on Terra’s Blockchain
In a leaked chat conversation, TerraForm Labs founder Do Kwon admits to artificially boosting trading volume on Terra’s blockchain. This revelation comes amid an ongoing lawsuit by the SEC investigating investor fraud and manipulation of cryptocurrency prices. The leaked transcript shows Do Kwon proposing the creation of fake transactions and expressing his determination to make them indistinguishable from real ones. The SEC’s crackdown on crypto follows the fallout from the Terra Luna fiasco in 2022, highlighting the importance of addressing investor concerns and restoring confidence in the industry.
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