BREAKING: South Korean Court Issues Arrest Warrant Against Terra LUNA Founder Do Kwon
- Several crypto companies including Hodlnaut were directly affected by the collapse of Terra Luna.
- The Terra Luna Classic (LUNC) has dropped approximately 18 percent to exchange hands at around $0.00029733.
- Back in 2021, Kwon was dealing with legal issues against the United States SEC over Terra’s Mirror Protocol.
A court in South Korea has issued an arrest warrant against Terra LUNA founder Do Kwon for violating the country’s financial laws. According to a report by Bloomberg, the Seoul court has noted that Do Kwon and his company Terra Luna violated the nation’s capital markets law. Additionally, the court also issued an arrest warrant for five other individuals closely related to the Terra saga. Worth noting, that some of the said individuals are from Singapore.
In previous interviews, Kwon has explicitly stated that he is ready to cooperate with law enforcement if need be. “Life is Long,” Kwon said.
$40 Billion Terra Luna Saga Orchestrated by Do Kwon
Several crypto companies including Hodlnaut were directly affected by the collapse of Terra Luna. The collapse had a domino effect on several other companies that had staked their assets on the UST stablecoin. Furthermore, the Terra Luna collapse was so sudden that few investors were able to withdraw their assets on time.
Remember, UST stablecoin investors had around three weeks before their staked assets could be processed for withdrawal. Consequently, all their assets went to zero together with Luna and the UST stablecoin.
Afterward, the Terra Luna ecosystem tried to rebrand to a new network dubbed Terra Luna Classic (LUNC). According to our market data, the LUNC token has a market capitalization of approximately $2 billion and a traded volume of around $1.6 billion.
Following the announcement, the Terra Luna Classic (LUNC) has dropped approximately 18 percent to exchange hands at around $0.00029733. The circulating supply of LUNC is 6,903,418,595,269 units with an infinite maximum supply.
There is no specific reason as to why the UST stablecoin depegged from the U.S dollar after years of success. However, global regulators including the United States have been pushing for stablecoins to be fully backed by liquid fiat currencies. Perhaps, internal pressure on the Terra Luna ecosystem from outside forces pushed the network to the limit and later led to its downfall.
Back in 2021, Kwon was dealing with legal issues against the United States SEC over Terra’s Mirror Protocol. Notably, the Mirror protocol is a decentralized finance (DeFi) platform on which synthetic stocks mirroring the price of major U.S. firms were minted and traded.
The investigation on the Terra Luna saga has involved several jurisdictions and is likely to push further as ongoing cases take ground. For instance, Hodlnaut is under Singapore’s judicial management following the exposure with Terra Luna.
As the pressure mounts on institutional investors to return users’ money, they are more likely to go for Kwon and his acquired assets. Furthermore, Kwon has amassed more money over the past four years that Terra Luna has been in existence.
Meanwhile, the cryptocurrency market is being heavily scrutinized and decentralized stablecoins are less likely to see a streak of daylight.
Rebecca is a Senior Staff Writer at BitcoinWisdom, working hard to bring you the latest breaking news in the cryptocurrency market. In the words of Elon Musk “Buy stock in several companies that make products & services that *you* believe in. Only sell if you think their products & services are trending worse. Don’t panic when the market does. This will serve you well in the long-term.”
