- TFL co-founder Shin’s home raided as South Korea widens LUNA collapse probe.
- Prosecutors have raided several crypto exchanges and offices linked to the collapse.
- The probe occurs despite Shin declaring to distance himself from Kwon and TFL.
South Korean investigators raided Terraform Labs’ co-founder Daniel Shin’s home, to probe into allegations of illegal activity behind the Terra-LUNA debacle. This investigation was a part of a series of raids conducted on crypto exchanges and offices that were allegedly linked to the Terra collapse.
The Seoul Southern District Prosecutors’ office confirmed that in the series of raids, Shin’s payment app Chai Corp’s office was also under scrutiny. Investigators also visited two affiliated firms regarding the matter but declined to provide further information about the ongoing investigation.
This week, the Joint Financial and Securities Crime Investigation Team of the South Korean Prosecutors Office conducted raids on 15 firms, including 7 local crypto exchanges like Upbit, Bithumb, and Gopax. The raids took place a month after the authorities summoned Terraform Labs’ current and former employees for questioning, and banned them from leaving the country.
Prosecutors are also probing if the company’s CEO Do Kwon evaded taxes by transferring profits from the crypto transactions to an unknown overseas account. The authorities have also pressed money-laundering charges against Kwon. However, since Terra imploded, Shin announced on his app that he has distanced himself from Terraform Labs and Kwon.
Both Kwon and Shin have addresses in Singapore, though it’s unclear if they reside there currently, also both have declined to comment on this matter. The US Securities and Exchange Commission (SEC) is also conducting an investigation against Kwon and the company.
Terra has been under the critical scrutiny of policymakers around the world since its crash in May which has sparked a debate about whether blowups of such crypto experiments pose a risk to the wider financial system. The instability of other stablecoins raising turmoil in the crypto market has fueled this debate further.