The founder of Terra LUNA ecosystem, Do Kwon, could face up to 40 years in prison on charges related to the staggering $40 billion loss suffered by investors last year. The legal battle surrounding Kwon’s extradition to South Korea and the US has revealed the extent of the fallout from the LUNA token collapse, with authorities preparing to bring Kwon to justice on different charges in the two nations.
Kwon was arrested earlier this year in Montenegro and currently awaits extradition. His future may include being tried and sentenced in both South Korea and the US, according to Dan Sunghan, director of the financial crime investigation bureau at the Seoul Southern District Prosecution Service. This possibility, which Dan discussed with Bloomberg News, could result in Kwon facing a combined prison term of up to four decades for financial fraud.
Investigations into the LUNA token collapse have revealed some alarming findings. The US Securities and Exchange Commission (SEC) has accused Kwon and Terraform Labs of fraud, and both US and South Korean prosecutors have filed charges against the founder, including breaches of capital-markets law. Kwon’s legal representatives continue to claim the fraud allegations are unfounded and dismiss prosecutor accusations.
Authorities are still probing the alleged movement of 10,000 Bitcoin from the failing project, some of which were converted into cash through a Swiss bank. A cold wallet, unconnected to digital asset exchanges, was used to store the tokens. Meanwhile, Kwon and Terraform Labs accessed the wallet intermittently since May of last year, although the current location of the cold wallet remains unknown.
With $190 million seized in connection to the case so far, an additional 31.6 billion won will soon be within the prosecutors’ grasp. South Korea’s legal authorities consider Kwon’s case the “largest financial fraud or financial securities fraud case that has ever happened” in the country, making the pursuit of Kwon’s extradition a high-stakes game.
The ongoing extradition battle and related legal proceedings highlight the need for stringent oversight and regulation in the cryptocurrency market. Investors must exercise caution and conduct thorough research before investing in digital assets, as the Kwon case reveals the potential for losses on an unprecedented scale. While the ultimate resolution of Kwon’s legal troubles remains to be seen, this case underscores the importance of transparency and an unwavering commitment to the ethical conduct of business within the ever-evolving landscape of blockchain technology and cryptocurrencies.
Source: Coingape
