South Korean prosecutors seek arrest warrant for Terraform Labs co-founder, investor and engineer

South Korean prosecutors said Wednesday that they have requested arrest warrants for eight people linked to Terraform Labs for alleged fraud as local authorities expand their investigation into the TerraUSD token collapse and Luna wiped tens of billions of dollars off the cryptocurrency market before that. five.

The Seoul Southern District Prosecutors’ Office has confirmed to TechCrunch that it is seeking arrest warrants for eight people including Terraform Labs co-founder Daniel Shin, three Terraform investors, and four engineers of the TerraUSD (UST) cryptocurrency. ) and Luna, but did not reveal the identities of most individuals.

This move comes two months after Korea issued an arrest warrant for another co-founder, Do Kwon, whereabouts are currently unknown, and ask for Interpolinternational law enforcement agency, issue a red notice to Kwon.

Prosecutors suspect that Shin made an illegal profit of about $105 million (140 billion won) by selling Luna at the top without properly disclosing it to investors before Terra-Luna collapsed. dumped, according to a local media report Yonhap. Shin is also accused of using customer data from his own separate financial technology startup Chai to advertise Luna, in violation of the Electronic Financial Transactions Act. Local authorities reported a raid on Chai’s office in mid-November as part of UST-Luna’s fraud investigation.

Shin has denied claims that Luna traded at a high level in the market and breached customer data. Shin’s attorney said today that Shin left Terraform two years ago before the fall of Terra-Luna and that he had nothing to do with that failure, according to local media.

Terraform was founded in Singapore in 2018 by Do Kwon and Shin. Shin left Terraform in March 2020 to found Chai and stepped down as CEO of Chai earlier this year.

The Seoul Southern District Prosecutor has confirmed a court will hold a hearing to determine the validity of the arrest warrant this Friday, December 2.

Terraform’s UST and Luna expired in early May after the so-called stablecoin dropped in value from $1, wiping out $40 billion of investors and causing an uproar. South Korean prosecutors have begun an investigation following the crash of the UST-Luna token.

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