As the initiator of terrausd (UST) algorithm stable coin and its sister token Luna, terraform labs executives are facing legal proceedings in South Korea due to the avalanche of two encrypted tokens** Previously, affected by the collapse of cryptocurrency market in the last half month, the assets of global ust / Luna investors instantly evaporated billions of dollars.
The latest news: the South District Prosecutor's office of Seoul said on Friday that it had begun to investigate terraform labs, the organization behind terra, a stable currency project led by do Kwon, and assigned the case to its joint investigation team on financial and securities crimes.
Local media reported that the newly appointed legal minister don Hoon Han would lead the investigation of terraform labs, and the company's CEO do Kwon and co-founder Daniel Shin would bear the brunt.
The day before the news, five Korean cryptocurrency investors who lost 1.4 billion won (about US $1.1 million) had filed criminal proceedings against them for fraud and violations of other financial regulations.
South Korean financial authorities estimate that about 280000 local investors hold a total of 70 billion Luna tokens. LKB & A representative of partners said:
The design and issuance of Luna and Terra are intended to attract a large number of investors, but the issuer did not correctly inform the defects and Luna's circulation will expand indefinitely, which is undoubtedly a fraud.
In addition, it is reported that do Kwon also faced a fine of 100 billion won (about US $78 million) for evading the payment of corporate tax / income tax.
Compared with other stable currencies, ust cannot provide support for fixed currency or real assets, but maintains the currency value at about US $1 by destroying its sister token Luna.
Unfortunately, as one of the once promising algorithmic stability currencies, terrausd (UST) lost its 1:1 anchor with the US dollar last week and soon fell to almost worthless (- 99%).
At the same time, the block also took the lead in disclosing that the internal legal team of terraform labs had collectively resigned after the UST / Luna crash.