A major scandal in the crypto world has led to the indictment of Daniel Shin, the co-founder of Terraform Labs, by South Korean prosecutors.
Terraform Labs Co-Founder Indicted in South Korea
A major scandal in the crypto world has led to the indictment of Daniel Shin, the co-founder of Terraform Labs, by South Korean prosecutors. Shin and nine others are accused of various crimes related to the collapse of Terra and Luna, two cryptocurrencies developed by Terraform Labs. Terra was supposed to be a stablecoin that maintained a 1:1 ratio with the US dollar, while Luna was a utility token that helped stabilize Terra's price. However, both coins plummeted in value last year, wiping out $60 billion in market capitalization and triggering a crypto winter that affected the entire industry.
Shin's co-founder, Do Kwon, is also facing legal troubles in multiple countries. He was arrested in Montenegro in March after being on the run for several months. He is wanted by South Korea for fraud and embezzlement, and by the US for securities fraud. He also allegedly forged his passport when trying to flee to Dubai. Kwon is expected to stand trial in Montenegro on May 11th and may be extradited to South Korea or the US afterwards.
Shin's lawyer claims that his client had nothing to do with the Terra and Luna debacle, as he had left the company two years before it happened. He also says that Shin voluntarily returned to South Korea and cooperated with the investigation for over 10 months. Prosecutors have seized $184.7 million in assets from Shin and the other defendants. The case is one of the most high-profile examples of the risks and challenges facing the crypto sector.
