By
Chimamanda U. Martha
April 19th, 2024
Korean officials have linked approximately 91.4 billion won, worth about $69 million, in digital assets directly to Do Kwon.
South Korea officials continue to grill former Terraform Labs co-founder Kwon Do-Hyung, popularly known as Do Kwon, following his arrest earlier last month in Montenegro as he attempted to flee to Dubai. The collapse of Terra Luna and its algorithmic stablecoin UST led to a loss of over $40 billion from the crypto market. As a result, the entire cryptocurrency industry capitulated and has never fully recovered since then. Moreover, regulations around the world have not yet fully been put into place to prevent such incidents from existing crypto companies.
Additionally, the collapse of FTX and Alameda Research significantly tarnished the crypto market status.
South Korea Officials on Terra Luna’s Do Kwon
According to recent court revelations, Do Kwon did not have solid property that can be seized in South Korea. Nevertheless, South Korean officials have identified about 414.5 billion won worth approximately $314.2 million in illicit assets associated with Do Kwon and his associates. Interestingly, Korean officials have linked approximately 91.4 billion won, worth about $69 million, in digital assets directly to Do Kwon.
Reportedly, Kwon used overseas cryptocurrency exchanges to convert Terra Luna’s proceeds to Bitcoin. As a result, the Korean officials requested Binance, the largest centralized crypto exchange by daily traded volume, to halt any withdrawals connected to Kwon or his associates.
Meanwhile, Binance has confirmed that it is working closely with the Korean prosecutors and offering them the necessary assistance.
“We provided Korean LE authorities with the requested assistance. Since we cannot comment on ongoing LE investigations, for any further comment please reach out to the prosecutors,” Binance noted.
According to a report by a South Korean media outlet, illicit proceeds by Terraform Labs Co-founder Shin Hyun-Seong, and former CEO Chai, amounted to about 154.1 billion won. The remaining 7 Terra employees were reported to have siphoned a total of 169 billion won from investors.
End Game
The investors in Terraforms Labs were forced to count the Luna and UST crash and forced liquidation that may never be recovered. The Terra Luna project morphed into Terra Classic LUNC, which traded around $0.0001251 on Friday. According to market data provided by Binance-backed Coinmarketcap, Terra Classic LUNC has a reported market capitalization of approximately $737,726,064 and a 24-hour trading volume of about $116,073,937.
Nevertheless, the community-owned Terra Classic LUNC has distanced itself from Do Kwon who is wanted by several jurisdictions including Singapore and the United States for fraud charges.
Currently, it is not clear if Do Kwon will be jailed in South Korea or the United States. However, his arrest and prosecution will be a stern warning to other crypto projects seeking to defraud investors.