- Daniel Shin is being interrogated for his suspected involvement in the $40 billion collapse of LUNA and UST tokens
- Do Kwon was recently arrested in Montenegro after months of hiding from authorities and has since been charged with securities fraud and commodities fraud
- While Daniel Shin denies any ties to Terraform Labs, the investigation into this story continues to develop and create more questions for those affected by it
The Terraform Labs controversy has taken an unexpected turn with the recent court appearance of Shin Hyun-Seong, also known as Daniel Shin. He is being interrogated for his suspected involvement in the collapse of LUNA and UST tokens that caused investors to lose an estimated $40 billion last spring.
The main culprit behind this catastrophe, Do Kwon, was recently arrested in Montenegro after months of hiding from authorities. Upon arriving at the Seoul Southern District Court on March 30, reporters bombed Daniel Shin with questions but refused to comment. He is accused of violating several acts, such as the Capital Markets Act, and likely profited illegally off LUNA tokens before their demise.
In response to the allegations against him, Daniel Shin denied any ties to Terraform Labs, claiming he left two years before its collapse. However, Kwon’s arrest indicates he may have been preparing to flee the country by carrying false documents when caught at Podgorica Airport.
The US prosecutors charged Kwon with securities fraud and commodities fraud shortly after his detention in Montenegro, which will hold him under custody for an additional 30 days before deciding whether he will face justice there or be deported elsewhere – possibly South Korea or America.
The unforeseen outcome of this story continues to develop and create more questions for those affected by it. It remains to be seen what other turns this story will take shortly.
The Fall of Terra and Its “Restoration” in Crypto Exchanges
May 22, 2022, will be remembered by the crypto community as one of the darkest days in its history. On that day, LUNA and UST both plummeted to $0, leading prominent trading platforms such as Binance, Bybit, and eToro to delist them from their markets.
The fall was due to the UST stablecoin’s depegging after Do Kwon went on a series of boasts regarding the “strong” integrity of UST’s reliance on an algorithm to keep the peg afloat. However, he would soon eat his words after UST lost its balance, causing a devastating domino effect in the Terra system, pulling LUNA from its all-time high of $120 to less than $0.001.
However, on May 13, Binance re-listed LUNA and UST for the /BUSD exchange under the new names LUNC and USTC, with “C” referring to Classic.
Comments from Terra Labs CEO followed this re-listing Do Kwon regarding potential solutions to the crisis. As a result, investors have seen LUNA skyrocket by over 20,000% since then as early adopters made huge profits from the market upturn.
