Celsius

Optimus

Terra

Anchor

<div class="textg" style="text-align: justify; font-weight: lighter; line-height: 1.3em; font-size: 15px; border-radius: 3px; color: #80909a; padding: 10px; background-color: #F4F6F9; margin-bottom: 15px;">
 Neither the author, Tim Fries, nor this website, The Tokenist, provide financial advice. Please consult our&nbsp;<a href="https://tokenist.com/terms-of-service/" style="text-decoration:underline;color:#3c7b7b" target="_blank" rel="noreferrer noopener" class="deco-link">website policy</a>&nbsp;prior to making financial decisions.
</div> 
<p class="has-drop-cap">Do Kwon’s Terra (LUNA) was the vanguard that preceded the largest string of crypto busts during 2022, from Celsius to 3AC and FTX. After his arrest in Montenegro, what resolution can be expected as two countries make their case to extradite and put him on trial? According to WSJ, Mr. Kwon could face up to <a aria-label="forty years (opens in a new tab)" href="https://www.wsj.com/articles/south-korean-prosecutor-calls-for-crypto-entrepreneur-do-kwon-to-face-charges-in-home-country-639f5515" target="_blank" rel="noreferrer noopener nofollow" class="deco-link">forty years</a> in prison.</p> 
<h3 id="recap-of-the-terra-downfall">Recap of the Terra Downfall</h3> 
<p>When Terra crashed in May 2022, it was trending to be one of the top blockchain networks behind Ethereum. Much of its popularity came from the novel dynamic between Terra (LUNA), the network’s native cryptocurrency, and TerraUSD (UST) stablecoin.&nbsp;</p> 
<p>The latter was algorithmically pegged to LUNA, wherein smart contracts constantly readjusted the supply of UST/LUNA depending on the demand for both. For instance, if the price of LUNA went up, the algorithm would reduce UST supply with a buyback of UST with LUNA. Therefore, decreasing the price of UST so the peg to the dollar would be stabilized.</p> 
<p>As this concept eliminated the reliance on traditional banks as stablecoin reserve custodians, it seemed to push the DeFi envelope of innovation. Moreover, Terra’s lending protocol Anchor contributed hugely to attracting investors, as it offered up to 20% yields for UST deposits.</p> 
<p>Yet, after the Fed began its hiking cycle, it came<a href="https://tokenist.com/luna-drops-50-in-a-day-as-ust-peg-fails/" rel="dofollow" class="deco-link"> crashing down</a>. TerraUSD lost its peg, despite the planned deployment of Bitcoin reserves to shore up the stablecoin. Within three short days, the entire Terra ecosystem wiped out nearly $45 billion of wealth.</p> 
<h3 id="from-honest-mistake-to-suspected-malfeasance">From ‘Honest Mistake’ to Suspected Malfeasance</h3> 
<p>After Terra’s crash in May 2022 took authorities three months to begin viewing the founder, Do Kwon, as a criminal. Before that, Terra’s meltdown was primarily seen as a failed experiment. On September 26, 2022, Interpol issued a ‘red notice’ for Do Kwon, the South Korean co-founder of Terraform Labs.</p> 
<p>Following the South Korean arrest warrant for fraud and breach of capital market laws, the’ red notice’ alerted law enforcement agencies worldwide to apprehend him. This was when the incongruity of Kwon’s statements began to kick in fully.</p> 
<div class="wp-block-image"> 
 <figure class="aligncenter size-full">
  <img decoding="async" width="883" height="351" src="https://tokenist.com/wp-content/uploads/2023/05/Screenshot-2023-05-05-181435.png" alt="" class="wp-image-152246" srcset="https://tokenist.com/wp-content/uploads/2023/05/Screenshot-2023-05-05-181435.png 883w, https://tokenist.com/wp-content/uploads/2023/05/Screenshot-2023-05-05-181435-300x119.png 300w, https://tokenist.com/wp-content/uploads/2023/05/Screenshot-2023-05-05-181435-768x305.png 768w, https://tokenist.com/wp-content/uploads/2023/05/Screenshot-2023-05-05-181435-650x258.png 650w" sizes="(max-width: 883px) 100vw, 883px">
 </figure>
</div> 
<p>Surprisingly, Kwon even appeared on <a aria-label=" (opens in a new tab)" href="https://www.youtube.com/watch?v=RgYSJVC7Ps8" target="_blank" rel="noreferrer noopener nofollow" class="deco-link">Unchained Podcast</a> a month later, claiming that the charges were “politically motivated.” Fast forward to March 2023, and Do Kwon, alongside Hang Chang-joon, Terraform Labs co-founder, were finally apprehended in Montenegro’s capital Podgorica, having been caught with multiple counterfeit passports.&nbsp;</p> 
<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter">
 <div class="wp-block-embed__wrapper"> 
  <blockquote class="twitter-tweet" data-width="500" data-dnt="true">
   <p lang="en" dir="ltr">Exclusive footage —- Do Kwon and Han Chang-joon leaving Montenegrin court in handcuffs <a href="https://t.co/IwTnyUpLRS" target="_blank" rel="nofollow">pic.twitter.com/IwTnyUpLRS</a></p>— Isabel Hunter (@isabelhunter) <a href="https://twitter.com/isabelhunter/status/1639303145770876931?ref_src=twsrc%5Etfw" target="_blank" rel="nofollow">March 24, 2023</a>
  </blockquote>
  <script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script> 
 </div>
</figure> 
<div class="cta-referral"> 
 <img src="https://tokenist.com/wp-content/themes/thetokenist/assets/img/del/cta-referral-1.png" alt="" class="cta-referral__img" loading="lazy" decoding="async"> 
 <div class="cta-referral__text"> 
  <p>Join our&nbsp;<a href="https://t.me/thetokenist" target="_blank" rel="noreferrer noopener nofollow">Telegram group</a>&nbsp;and never miss a breaking digital asset story.</p> 
 </div> 
</div> 
<h3 id="is-extradition-to-south-korea-imminent">Is Extradition to South Korea Imminent?</h3> 
<p>In addition to South Korean authorities, the US Securities and Exchange Commission (SEC) <a aria-label=" (opens in a new tab)" href="https://www.sec.gov/litigation/complaints/2023/comp-pr2023-32.pdf" target="_blank" rel="noreferrer noopener nofollow" class="deco-link">sued Do Kwon</a> for multiple violations in February:</p> 
<ul> 
 <li>Fraudulent scheme to mislead investors.</li> 
 <li>Painting UST as stable while secretly colluding with a third party to buy massive amounts of UST to restore the peg a year before the crash happened in May 2021.</li> 
 <li>They were selling unregistered securities and security-based swaps.</li> 
</ul> 
<p>The South Korean charges follow a similar line. In short, Do Hyeong Kwon (31) allegedly concocted the Terra ecosystem to siphon investor inflows. This would be similar to how Sam Bankman-Fried used the FTX’s FTT token to falsify the exchange’s valuation, among <a href="https://tokenist.com/ftx-chief-engineer-pleads-guilty-to-fraud-and-conspiracy-charges/" rel="dofollow" class="deco-link">multiple other fraud charges</a> to which his associates had already pleaded guilty.</p> 
<p>It is now a matter of extraditing Do Kwon to either the US or South Korea, as he is still locked up in Podgorica, Montenegro. In a recent interview <a aria-label="to WSJ (opens in a new tab)" href="https://www.wsj.com/articles/south-korean-prosecutor-calls-for-crypto-entrepreneur-do-kwon-to-face-charges-in-home-country-639f5515" target="_blank" rel="noreferrer noopener nofollow" class="deco-link">with WSJ</a>, the head of South Korean prosecutors, Dan Sung-han, believes justice would be best served on home grounds.</p> 
<blockquote class="wp-block-quote"> 
 <p><em>“Given the nature of this incident, we think investigating the case in South Korea would be the most efficient way of bringing justice”</em></p> 
</blockquote> 
<p>After all, Kwon’s other associates and collected evidence are already in South Korea. If the prosecution successfully delivers the extradition and the case, Do Kwon could receive up to 40 years.&nbsp;</p> 
<p>This would be in line with another convicted fraudster, Kim Jae-Hyun, the CEO of Optimus Asset Management. He was sentenced to 40 years for investment fraud in July 2022.</p> 
<div class="cta-sub js__cta-sub"> 
 <div class="cta-sub__start" data-step="1"> 
  <div class="cta-sub__title">
   <strong>Finance is changing.</strong>
  </div> 
  <div class="cta-sub__subtitle">
   Learn how, with Five Minute Finance.
  </div> 
  <div class="cta-sub__excerpt">
   A weekly newsletter that covers the big trends in FinTech and Decentralized Finance.
  </div> <button type="button" class="btn">Try it out (for free)</button> 
 </div> 
 <div class="cta-sub__form" data-step="2" style="display: none;"> 
  <script type="text/javascript" src="https://app.getresponse.com/view_webform_v2.js?u=QcLhh&amp;webforms_id=hpcwd"></script> 
 </div> 
 <div class="cta-sub__result" data-step="3" style="display: none;"> 
  <div class="cta-sub__title">
   Awesome
  </div> 
  <div class="cta-sub__caption">
   You’ve subscribed.
  </div> 
  <div class="cta-sub__greeting">
   You’re well on your way to being in the know.
  </div> 
 </div> 
</div> 
<p><strong><em>Do you think Do Kwon had honest intentions initially, which fouled later? Let us know in the comments below.</em></strong></p> 
<p>The post <a rel="nofollow" href="https://tokenist.com/do-kwon-could-face-40-years-in-prison-if-extradited-to-south-korea-report/">Do Kwon Could Face 40 Years in Prison if Extradited to South Korea: Report</a> appeared first on <a rel="nofollow" href="https://tokenist.com">Tokenist</a>.</p>

Do Kwon Could Face 40 Years in Prison if Extradited to South Korea: Report

목차

TokenInsight

2023년 5월 5일에 게재된 다른 기사

LedgerX Sale Approved in FTX Bankruptcy Case

Top 10 Ways to earn passive income from crypto in 2023

Pepe Price Soars, but Is Its Growth Sustainable?

Alchemy Pay Offers Direct Fiat-to-Crypto off an on-Ramps to Suiet Wallet

Looking for simple ways to subscribe for Spotify or Apple Music in Nigeria? Here are 3 easy options.

Lydian.World Launch the New Metaverse Game on May 14th, 2023 at the Coca Cola Arena in Dubai

무료 뉴스레터에 가입하여 매일 최신 암호화폐 소식을 받아보세요!