Prosecutors Orders Arrest of Terraform Labs’ Daniel Shin

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According to the Yonhap news agency, the Seoul Southern District Prosecutors Office has issued an arrest warrant against failed Terraform Labs co-founder Daniel Shin. 

This is the latest in the series of domino effect-like events that have followed the collapse of the Terra ecosystem. This news is coming months after the crash of the Terra ecosystem and its algorithmic stablecoin TerraUSD (UST).

As per the reports, the prosecutors have ordered the arrest of Daniel Shin together with three other Terraform investors as well as four Engineers of the firm’s cryptocurrencies- LUNA and TerraUSD.

They are charged with allegedly gaining illegal profits before the fall of the firm’s cryptocurrencies.

In addition, the prosecutors suspected Daniel stored cryptocurrencies that had been pre-issued without making it known to the investors. Hence, pocketing the illegal profits worth 140 billion (US$105 million) as well as issuing out the tokens at a very high rate.

Furthermore, it was discovered that Daniel also violated the Electronic Financial Transaction Act by using customers’ information and funds of the fintech firm Chai Corp to promote LUNA.

Meanwhile, Daniel expressed his dissatisfaction with the prosecutors stating that he left the firm two years before its collapse and had nothing to do with the collapse. Despite his unending cooperation as regards the investigation, Daniel was not expecting to hear the prosecutors’ allegations as well as the warrant.

South Korean Authorities Investigate LUNA fall

South Korean authorities are bent on doing everything possible in finding the real culprit behind the massive collapse of Terraform Labs, TerraUSD (UST), and LUNA.

In a bid to ascertain whether the collapse of the ecosystem was internally caused by Do Kwon, The Seoul Southern District Prosecutor’s Office raided seven exchanges to investigate a fraud case linked to Terraform’s Lab LUNA disaster.

Meanwhile, in October, the authorities mounted pressure on the company’s co-founder Do Kwon by freezing $39.4 million (56 billion won) in assets linked to the billionaire founder.

Unfortunately, the crash of the Terra ecosystem resulted in the cataclysmic fallout of the broader crypto industry. Both Voyager and Celsius went bankrupt and filed for bankruptcy protection due to their exposure to the fallen Terra ecosystem.

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