According to South Korean media sources, a specialised financial crimes unit has been assigned to investigate last week’s collapse of the Terra blockchain’s main cryptocurrency, while founder Do Kwon faces significant tax penalties.
According to SBS News, the committee, which includes prosecutors and staff from the Financial Services Commission and the Financial Supervisory Service, will look into the methods Terraform Labs used to attract investors.
The unit’s accuracy and clinical approach have earned it the nickname “Yeouido Grim Reaper,” after Seoul’s Yeouido financial district. According to SBS News, it is restarting operations to investigate Terra despite being disbanded two years ago.
The Terra ecosystem was thrown into chaos last week when its stablecoin offering, TerraUSD (UST), was de-pegged, forcing the value of Terra’s native token, Luna, to fall as supply increased to safeguard the peg. Kwon is now suggesting a Terra fork in order to revive the network.
According to Edaily, the investigation was tied to the founding of the Luna Foundation Guard (LFG) in Singapore, a move of the company’s headquarters that appeared to be for tax reasons. It found that, despite the formal entity’s relocation to Singapore, LFGs’ administration is being carried out by local firms and South Korean citizens.
