Singapore Investigates Collapse of Terraform Labs‘ LUNA, UST Tokens

6. März 2023 Aus Von admin

Singapore Investigating Terraform Labs

  • Singapore’s police have started a probe against Terraform Labs.
  • The collapse of the project’s native token (LUNA) and its algorithmic stablecoin (UST) caused investors to lose billions.
  • Do Kwon – Co-Founder of Terraform Labs – is accused of having a role in the collapse.

Investigation Commencement

Singapore’s law enforcement agencies have reportedly begun a probe against Terraform Labs – the infamous blockchain project co-founded by crypto fugitive Do Kwon. In an emailed announcement seen by Bloomberg, Singapore’s police stated, „investigations have commenced in relation to Terraform Labs,“ adding the inquiries are „ongoing.“ The authorities also estimated that the 31-year-old developer is not hiding in the city-state.

The Collapse of LUNA & UST

The collapse of the organization’s native token – LUNA – and its algorithmic stablecoin – UST – was among the darkest events in crypto last year. The stablecoin, which was supposed to have a fixed $1 valuation, lost its peg against the greenback in May 2022 and plunged way below its price target. Realizing the turbulence, investors started selling their UST reserves en masse. This resulted in more LUNA being minted to stabilize the freefall, which significantly increased the supply of the native coin. Eventually, both assets lost virtually all their value in a matter of days, triggering multi-billion investor losses and a broad market decline that echoed for months.

Accusations Against Do Kwon

Failed investors and numerous institutions accused Do Kwon – Co-Founder of Terraform Labs – of having a role in the collapse.

Conclusion Singapore’s investigation into Terraform labs has revealed that Do Kwon is not currently inside Singapore borders. It will be interesting to see what other information comes out during this investigation and if any incriminating evidence can be found against Do Kwon for his involvement with Luna & UST’s collapse