South Korean Sleuths Indict Terra Co-Founder, Uncovering Do Kwon’s $8.6M Nest Egg

The special task force is digging deep for Terra’s nest eggs as Do Kwon faces a gloomy year in Montenegro.

A man shouting on the phone while holding a golden egg nest surrounded by a cartoon beam with steam coming out of his mouth.
Created by Kornelija Poderskytė from DailyCoin
  • TerraForm Labs co-founder Daniel Shin is charged with fraud by South Korean law.
  • The lawsuit tackles nine other Terra investors who breached capital markets law.
  • The criminal case revolves around the malfunctioned stablecoin UST and LUNA.

The South Korean special task force made a breakthrough in the controversial case of one of crypto’s worst financial disasters. Authorities claim that the entire ecosystem of Terra Luna, including the algorithmic stablecoin Terra USD (UST) and Terra Luna (LUNA), was fabricated from the start.

According to the leaked court documents, Do Kwon, Daniel Shin, and eight other co-founders caused “astronomical damage” to the investors by deliberately keeping the holders in the dark about the actual situation.

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While Shin was left alone after the December court hearing, the defendant’s argument of a minor flight risk might have won him some time. However, the crypto entrepreneur was still eventually indicted.

Sleuths Find 10,000 Bitcoins in Kwon’s Secret Stash

Meanwhile, the U.S. Securities and Exchange Commission discovered that Do Kwon was secretly holding a hefty sum of 10,000 Bitcoins transferred into various external wallets in a couple of months amid the crash.

The Swiss bank Sygnum is a digital asset bank that has its roots in Singapore but is headquartered in Switzerland. According to a recent report by the SEC, Sygnum allegedly maintained a business relationship with the crypto fugitive Do Kwon.

On top of that, the SEC points out that Do Kwon converted the Bitcoins into fiat and transferred over $100 million to an escrow account to an international law team. While these funds were spent, there’s also another $185 million in crypto assets already frozen by prosecutors.

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While a large chunk of the rest of the converted Bitcoins was used to cover staff salaries, the detectives also revealed that there’s still $8.6 million kept in Do Kwon’s Swiss nest egg.

On The Flipside

  • Daniel Shin was formally charged but not detained, as the defendant’s lawyers claim that he returned to South Korea voluntarily and is unlikely to destroy any evidence.

Why You Should Care

The Terra (LUNA) and Terra (UST) fiasco caused extensive harm to the cryptosphere. TerraForm Labs is linked to around $2 trillion of crypto assets sent down the drain.

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This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed as financial, legal, or tax advice. Trading forex, cryptocurrencies, and CFDs pose a considerable risk of loss.

Author
Tadas Klimasevskis

Tadas Klimaševskis is a Lithuanian journalist at DailyCoin, specializing in covering the lighter side of the crypto industry such as memecoins and pop culture in the metaverse. He has experience as a music artist, English language teacher, and freelance writer, and uses his creative writing skills to summarize valuable information in his work. He is also a strong believer in the potential of blockchain and spends his free time listening to music, traveling, and watching basketball games.