The United States Securities and Exchange Commission (SEC) has amplified its scrutiny of Terraform Labs by forming a partnership with the South Korean government.
This collaboration aims to augment the existing evidence pool regarding Terraform Labs' operations.
Terraform Labs, the entity responsible for the Terra blockchain and Terra USD stablecoin, is currently facing intensified inspection following revelations of crypto market manipulation and deceitful transactions that emerged during its investigation.
In response to the expansive nature of the case, District Judge Jed Rakoff has granted the SEC's motion to collaborate with South Korea.
The joint effort intends to delve deeper into the affairs of Terraform Labs and to interrogate Daniel Shin, Co-founder of Terraform Labs.
The decision to align investigative efforts with South Korea comes on the heels of a recent report from Bloomberg.
The report spotlighted the SEC's intent to extract valuable evidence from Chai Corp, a South Korean financial services company owned by Shin.
Shin established Chai Corp in early 2019 and maintained a symbiotic association with Terraform Labs, sharing resources, data, and facilities. Intriguingly, the partnership between these two entities was severed in 2020.
The rationale behind this dissolution has emerged as a pivotal aspect of the SEC's ongoing inquiries.
In 2022, the SEC initiated a legal action against Terra and its former CEO and Co-founder, Kwon Do-Hyung.
The regulatory body asserts that the collapse of Terra was exacerbated by Do Kwon's actions rather than market fluctuations.
Allegedly, Do Kwon orchestrated an illicit cryptocurrency scheme that resulted in a substantial loss of $40 billion in cryptocurrency assets.
Terraform Labs maintains its denial of any wrongful conduct in its cryptocurrency dealings.
Shin finds himself facing multiple allegations of fraud.
These accusations suggest his awareness of Terraform's schemes and his role in concealing the risks associated with investments in the failed cryptocurrency platform.
Do Kwon, now in US custody, has pleaded not guilty to fraud charges tied to TerraUSD’s $40 billion collapse. Following his extradition, the Justice Department seeks prison time for financial fraud and fake passports, while South Korea sought a 40-year sentence. Calm in court, Kwon faces a long legal battle. Is he unrepentant or truly innocent?
CatherineBillion-dollar bombshell: Do Kwon and Terraform Labs embroiled in $4.5 billion SEC penalty! Explosive new evidence suggests a shocking conspiracy behind the catastrophic collapse of Terra, LUNA, and UST. Could Do Kwon and Daniel Shin orchestrate the fall of Terra from the beginning?
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