Without divulging any names, a South Korean media agency reported that the Seoul Southern District Prosecutor’s Office’s Joint Financial and Securities Crime Investigation Team has banned a key Terra designer from leaving the country. After the collapse of TerraUSD (UST), and its sister token LUNC, Terraform Labs and its founding members were swept under suspicion, the team began investigating Terraform Labs, its staff, and its founders.
The anonymous “key member” had allegedly told the media outlet that the company’s CEO, Do Kwon, revealed to them about making enough money to buy an island. This person also claimed that Kwon secretly sold cryptocurrency to institutions to raise large sums of money.
The prosecution is now investigating if the money funds were used for ‘market price adjustment’ that artificially inflates the token price.
This move may be the beginning of a large-scale investigation that includes searches and seizures. An official from the Ministry of Justice stated that in a statement
“It is impossible to confirm whether the departure ban is related to the confidentiality of the investigation.”
Uppsala Security’s research suggests that the financial collapse that led to billions of dollars in losses may have been caused by an inside job. It said the potential attacker’s wallet responsible for the events that transpired last month might have been associated with Terraform or any of its related entities.
South Korean prosecutors disproved the rumors that Terra was attacked by Wall Street whales. Rather, Terraform’s internal wallets were being investigated.
Terra’s implosion has attracted the ire of regulators across the world. The US Securities and Exchange Commission (SEC), launched a second investigation into Terraform Labs to verify that the tokens were indeed unregistered securities.
South Korean authorities were, however, forced to create a committee to strictly regulate and supervise the crypto industry. This was until the approval and rolling out of the Digital Assets Framework Act.
This latest development comes a day after Do Kwon and the Luna Foundation Guard were sued by Nick Patterson, an Illinois resident, for misleading investors.
New LUNA, Old Story
Terra’s revival plans may have delivered a new token – LUNA – but any meaningful possibilities of uptrend appeared to have been slaughtered amidst the ongoing bloodbath. Its price may repeat the same failure and no amount of Kwon’s assuring words seem to help.
Experts have expressed significant skepticism over the 2.0’s prospects. Mati Greenspan (CEO of Quantum Economics), a crypto research and investment company, said,
“Luna 2 was never meant to survive, it was simply a mechanism for some who were heavily invested to recoup some of their losses at the expense of new money coming in from the hype. I don’t see any reason for the price to go up ever.”