South Korean prosecutors reportedly obtained a court order to freeze assets worth around $104 million belonging to Terraform Labs co-founder Daniel Shin. Authorities allege that he unfairly profited from selling the LUNA cryptocurrency at high prices before the token crashed. Daniel Shin has denied these allegations.
South Korean authorities freeze assets of Terraform Labs co-founder
Seoul’s Southern District Court reportedly approved a request by local prosecutors on Thursday to freeze approximately $104 million in assets belonging to Terraform Labs co-founder Shin Hyun-seung, aka Daniel Shin. A pre-charge freezing order is a precautionary measure to prevent a suspect from disposing of the proceeds of crime before trial.
Prosecutors accused the Terra co-founder of profiteeringunjust” of approximately $104 million by selling the pre-issued cryptocurrency LUNA, now known as luna classic (LUC), without properly informing investors. However, Shin reportedly told prosecutors on Thursday that he did not sell the cryptocurrency to its maximum price before the token crashed.
Hwang Suk-jin, a professor of information security at Dongguk University and a regular speaker on cryptocurrency policy at South Korea’s National Assembly, was sentenced to three years in prison. quoted by Forkast as saying:
This is a pre-mining issue. This is because they failed to make proper disclosure while issuing the tokens.
The professor added that, for example, if investors “thought that 1,000 tokens were issued and in fact 10,000 were issued, investors inevitably suffer losses.”
Shin and Chai corp, a local payment technology company he founded, are being investigated for allegedly using customer information without consent when launching Chai’s Terra payment services. The payment company was reportedly raided by local authorities on Thursday.
South Korean prosecutors have also been investigating LUNA’s collapse since May and have issued an arrest warrant for Kwon Do-Hyung, aka Do Kwon, who co-founded Terraform Labs with Shin. Interpol also issued a red notice against him. Last month, South Korean authorities said they had frozen crypto assets belonging to Do Kwon. However, Do Kwon denied that the frozen coins were his.