Do Kwon Accused of Withdrawing Bitcoin Worth $100 Million After Terra Collapse
The collapse of the Terra/Luna stablecoin ecosystem resulted in investors losing almost $40 billion, causing a significant and ongoing market decline. However, recent developments suggest that the founder, Do Kwon, may have taken more than $100 million in Bitcoin after the platform’s collapse.
According to Bloomberg, Kwon allegedly transferred over 10,000 bitcoin from Terraform and Luna Foundation Guard crypto asset platform accounts to an un-hosted wallet. It’s said he then converted the bitcoin to cash using an undisclosed Swiss bank between June 2022 and February 2023.
Do Kwon attempted to exchange the bitcoin for fiat money when Bitcoin was trading at roughly $30,000, the value of the 10,000 bitcoin could have been worth a staggering $300 million.
The SEC alleges that Kwon and the Terraform firm deceived clients over various topics, including the selling of unregistered securities. The company and Kwon were sued by the SEC, with a New York judge ordering Terraform Labs to abide by the investigative subpoenas issued by the SEC in 2022. Now, the SEC accuses the company and Kwon of breaking the Exchange Act and Securities Act’s registration and anti-fraud provisions.
SEC chair Gary Gensler has stated that Terraform and Kwon failed to provide the public with honest disclosure about various crypto-asset securities, most notably LUNA and Terra USD.
It’s still unclear whether Kwon will be brought to justice for his alleged involvement in the collapse of the Terra/Luna stablecoin ecosystem.