Creators of cryptocurrencies Luna and TerraUSD accused of 40 billion
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Creators of cryptocurrencies Luna and TerraUSD accused of $40 billion in fraud

The US Securities and Exchange Commission (SEC) announced Thursday that it is suing blockchain platform Terraform Labs and its co-founder and CEO Do Kwon. You are accused of massive crimes “Cryptocurrency Asset Scam”. According to the lawsuit, Terraform Labs and Do Kwon “facilitated the launch of a fraudulent scheme that resulted in a loss of at least $40 billion in market value.”

    Image source: Kanchanara/unsplash.com

Image source: Kanchanara/unsplash.com

The lawsuit alleges that Terraform and Kwon misled investors “One of the most important aspects of Terraform’s offering is the stability of UST, an algorithmic stablecoin that is said to be pegged to the US dollar.” However, they did not inform investors that the stablecoin’s price fell below its dollar peg. “will be the death of the entire terraform ecosystem” considering that the platform did not have a reserve of assets to support TerraUSD (UST) and the LUNA token at the required levels.

The SEC also said that Kwon and Terraform misled customers that Korean mobile payment app Chai uses the Terraform blockchain to process transactions when in fact Chai payments were being made. “traditional ways”.

“We allege that Terraform and Do Kwon have failed to provide the public with the complete and reliable information required for a variety of cryptocurrency assets, notably Luna and TerraUSD. SEC Chairman Gary Gensler said in a statement. — We also allege that they committed fraud by repeating false and misleading statements to gain credibility before inflicting devastating losses on investors.”

Last September, a South Korean court issued an arrest warrant for Kwon, and Interpol reportedly issued a “red notice” to international law enforcement. “find and provisionally arrest a person awaiting extradition, extradition or similar legal process.”

Although Kwon insists that he “not on the run” The SEC lawsuit found this to be the case “His current address is unknown.” Kwon is said to be hiding in Serbia, where South Korean police went to arrest him earlier this month.

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Robbie Elmers

Robbie Elmers is a staff writer for Tech News Space, covering software, applications and services.

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