• US prosecutors have reportedly accused Do Kwon, Co-Founder of Terraform Labs, of orchestrating a cryptocurrency scam that drained at least $40 billion from investors.
• A grand jury in Manhattan has charged Kwon with securities fraud, commodities fraud, and conspiracy.
• The US Department of Justice launched an investigation against the project and its former employees to determine the main factors behind the catastrophe.
Terra’s Do Kwon Accused of Crypto Fraud
US prosecutors have accused Do Kwon—Co-Founder of Terraform Labs—of perpetrating a multi-billion dollar crypto fraud. A grand jury in Manhattan has charged him with securities fraud, commodities fraud, and conspiracy.
Arrested By Montenegro Authorities
Kwon was apprehended by Montenegro authorities earlier this week after months on the run and falsifying his identity. The US Securities and Exchange Commission (SEC) also filed charges alleging that Terraform Labs sold unregistered securities via digital currencies.
US Department of Justice Investigation
The US Department of Justice has also opened an investigation into the project and its former employees in order to uncover further details about the collapse of LUNA/UST last May resulting in multi-billion losses for investors.
Potential Punishment For Crypto Fraud
Kwon potentially faces punishment should his involvement with crypto fraud be proven beyond doubt by US prosecutors. It is yet unknown what action will be taken against any other individuals involved in the scheme or what kind of sanctions may be imposed upon them should they be deemed guilty.
It remains to be seen what comes out from this case as more information is revealed about alleged crypto scams involving Do Kwon and Terraform Labs as well as any other individuals who may have been involved in such activities.