South Korea Confiscates Over $100 Million from Terra’s Co-founder: Report

South Korean prosecutors have seized more than $100 million in assets belonging to Shin Hyun-Seong (Daniel Shin), the co-founder of Terraform Labs, for his role in the collapse of the Terra ecosystem in May.

According to reports from local publication YTN, the court approved the prosecutor’s request to freeze 140 billion won ($104 million) in profits generated by Shin from the sale of pre-issued LUNA tokens at a high price without informing retail investors.

Shin will cooperate with prosecutors

The request to seize Shin’s assets is part of an ongoing investigation to build a case against Terraform Labs that the co-founder generated unfair profits from Terra-related digital assets, including LUNA tokens. and collapsed USTs – renamed LUNC and USTC.

Authorities believe Shin violated local capital laws by secretly selling the tokens before the project collapsed. But his lawyer reportedly dismissed the allegations, noting that the allegations were false.

“The report that CEO Shin Hyun-seong made a profit by dumping Luna at the top, or that he made a profit in other fraudulent ways, is different from the truth,” the attorney said.

Prosecutors also claimed he played a role in the Terra crash and illegally sent customer transaction data from his payments technology company Chai Corporation to Terraform Labs. The court’s verdict is aimed at preventing Terra’s executive from disposing of the assets ahead of its trial this week.

According to Shin’s LinkedIn profile, he quit Terraform Labs in late 2020 when he left the company to find Chai. However, it is unknown if Shin had any investments in Terraform after its release.

Does Kwon promise to unmask the location?

While Hyun-Seong is cooperating with prosecutors, Terraform Labs CEO and founder Do Kwon has been on the run since May, with a red notice issued against him and his passport reportedly invalidated.

The whereabouts of Kwon are unknown, but reports claim that the founder of Terra is in Europe. The blockchain developer promised to hold a conference and expose its current location.

Meanwhile, despite the arrest warrant for Kwon, South Korean authorities are still struggling to build a case against the Terra founder due to the lack of regulatory clarity on crypto assets in the country.

Prosecutors say Kwon violated capital market laws. However, Terraform Labs accused the authorities of over-prosecuting, with the Terra boss saying the allegations against him were politically motivated.

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