Wednesday, 7 February 2024

Do Kwon Gets The Sam Bankman-Fried Treatment As Insider Testifies Against Terra Founders

by Rose White

Terra founder Do Kwon and co-founder Shin Hyun-Seong of the failed crypto project are still fighting legal battles almost two years after the devastating collapse of the network. This time around, the co-founders of the network are having to fight allegations brought on by an insider, who testified that both founders were aware of the troubles of the project.

Insider Testifies Against Terra Founders

In an interesting turn of events, an insider on the Terra project has come forward to testify against the co-founders of the failed Terra network in South Korea. Local news media outlet Chosun reported the court proceedings on the trial of Shin Hyun-seong, who is both a co-founder of Terra as well as the former CEO of the Chai Corporation.

The insider, who was identified only as “Lee,” was reportedly in charge of developing the technology that the Terra project was built on. According to Lee, he had actually realized that there were legal problems with the project that the co-founders were looking to build.

Going further into detail, the witness testified that they had known from the start that the proposed payments network using Terra Luna and incorporated with “ChaiPay” would be impossible to actualize. Furthermore, the witness elaborated that he had actually found out that this was impossible from Terraform Labs founder Do Kwon himself.

As Lee explained, they knew that coin payments using the Terra network were not viable, and it was not possible for these payments to be properly regulated. However, they went on to develop the project, which could eventually end up costing investors billions of dollars in losses when the network crashed in 2022.

Drawing Up A Defense Against The Testimony

In light of the testimony by Mr. Lee, Shin’s lawyers clapped back, saying that the statement was actually not true. According to them, the defendant did not know that it would be impossible to use the Terra network to carry out payments. Furthermore, they argued that none of the co-founders ever vocalized that they knew this and that “they did not think so.”

Shin Hyun-Seong, more commonly known as Daniel Shin, is currently facing trial in South Korea for allegedly violating the Capital Markets Act, as well as a host of other charges, including breach of duty and embezzlement.

Terraform Labs founder Do Kwon is currently in jail in Montenegro and several requests for extradition by both the South Korean and the US governments have been rejected so far. However, Han Chan-joon, Kwon’s finance officer who was also arrested alongside Do Kwon in Montenegro, has been extradited to South Korea.

Do Kwon Gets The Sam Bankman-Fried Treatment As Insider Testifies Against Terra Founders