Terraform Labs CEO Sent $7 Billion to Law Firm Prior to Ecosystem Collapse. South Korean prosecutors confirmed that Terraform Labs CEO Do Kwon sent $7 billion to Kim and Chang, a leading South Korean legal firm, shortly before the Terra ecosystem collapsed.
- Terraform Labs CEO Do Kwon sent 9 billion won (i.e., $7 billion) to Kim and Chang, a top South Korean law firm, prior to ecosystem collapse.
- According to Korean media, the transfers indicate that Do Kwon was aware of the impending collapse.
According to South Korean prosecutors working on the fraud case against Terraform Labs co-founder and CEO Do Kwon, the company has paid a total of 9 billion won (almost $7 million) to Kim and Chang, the country’s leading law firm.
The prosecutors believe Kwon was aware in advance of the crypto ecosystem’s failings and presumably planned specific legal steps in response to anticipated judicial concerns, such as the current probe.
They proved that the funds were sent in many transactions that began just before the collapse of Terraform’s digital currencies, stablecoin Terra USD and cryptocurrency Luna, by tracking financial flows from its Singapore headquarters.
It is estimated that about 200,000 people purchased Terraform’s cryptocurrency and suffered significant losses when it collapsed, wiping out billions of dollars in market value.
Seoul investigators are working with Singapore law enforcement officials to determine the source of the cash. Prosecutors in South Korea believe that if the funds are derived from illegal gains, they can be frozen and eventually seized.
On April 7, South Korean authorities suspected Kwon of converting illegal funds from Terra (LUNA) to Bitcoin (BTC) and ordered that any withdrawal requests associated with Kwon be halted. He was also previously detained at Montenegro’s Podgorica airport after attempting to fly to Dubai using forged documents.
The allegations leveled against Kwon and his collaborators emphasize the risks connected with bitcoin investments, as well as the significance of transparency and accountability in cryptocurrency project management. The case also highlights the role of law enforcement in investigating and prosecuting cryptocurrency-related financial crimes.
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Caleb is a technical writer at AlteBlock with over 2 years of experience in covering DeFi-related content such as crypto news, exchange reviews, and guides. He is also a Civil engineering graduate who can be found on-site when not writing an article.