- South Korean prosecutors have called on Binance to freeze all assets of Do Kwon, the former chief of Terraform Labs, who is accused of illegally transferring funds into cryptocurrency
- Prosecutors fear that Kwon may be liquidating his assets before they have a chance to recover them
- The plummeting prices of LUNA and USTC have raised concerns about the future of cryptocurrencies
In an unexpected development, the world’s biggest crypto exchange, Binance, has been called upon by South Korean prosecutors to freeze all assets belonging to Do Kwon, suspected of having illegally transferred funds into cryptocurrency. The investigators are worried that he may be liquidating his assets before they can recover them.
Kwon was arrested in Montenegro and is also facing charges of passport fraud in that country, making it even more difficult for South Korea to extradite him. His lawyers, meanwhile, had accused the US Securities and Exchange Commission of stepping outside its jurisdiction when it charged Kwon with fraud earlier this year.
The former chief of Terraform Labs had also had a hand in an unfortunate narrative involving the rebranding of Terra 2.0 and lunar tokens (LUNA), which saw the price skyrocket to nearly $20 when the coin was relaunched but then came crashing down to just $1.27 today; meanwhile Luna Classic (LUNC) is worth only $0.00012 while Terra Classic USD (USTC) is currently valued at just $0.02.
Although prosecutors plan on foreclosing sales of Kwon’s apartments in Seoul and properties situated in other parts of the country as part of their effort to recoup lost funds, it appears that a large portion of these was converted into Bitcoin and transferred overseas – which is why authorities must rely on Binance to freeze any wallets related to Do Kwon so that these funds may be recovered once he stands trial for his crimes against South Korea’s financial system.
LUNA: From Hero to Zero
The recent crash in the price of LUNA, a sister currency to TerraUSD (UST), has dealt a painful blow to many investors who had hoped for a quick turnaround. As Luna’s value dropped by more than 90% in just three days, investors were left counting their losses and reflecting on whether or not to trust cryptocurrencies again.
The crash indicates the immense risks associated with cryptocurrency investments, which can be highly volatile and subject to sudden changes in value. Many experts have ruled out any potential for recovery in the case of LUNA, meaning this serves as a cautionary tale for those hoping to see quick gains from their crypto investments.
LUNA’s aftermath caused its investors to demand their money back from Do Kwon, who allegedly went into hiding after the 100% crash as police authorities from South Korea and Singapore went to track him down. He ended up listed in Interpol’s Red Notice board – a list of wanted persons that police departments from all over the world should prioritize arresting.
The depegging of UST and LUNA’s once-towering market cap burned down billions of dollars, making it one of the worst disasters in both crypto and financial market histories.
