• Home
  • Cryptocurrency
  • Daniel Shin Unveils Shocking Truth: Terra's Collapse Was Not His Doing

Daniel Shin Unveils Shocking Truth: Terra's Collapse Was Not His Doing

Jack Evans
Oct 30, 2023 at 11:06 pm

In a dramatic turn of events that has sent shockwaves through the crypto community, Daniel Shin, co-founder of Terraform Labs, has broken his silence and unequivocally denied any involvement in Terra's tumultuous collapse. Shin's legal defense team delivered a resounding statement during a preliminary hearing in July 2023, making waves with their bold claims and finger-pointing.

Shin's attorneys, armed with a compelling defense, squarely placed the blame for Terra's crash on his co-founder, Do Kwon. According to their argument, Kwon bore the responsibility for the implosion of Terra's two tokens, Luna Classic and the algorithmic stablecoin UST. In a courtroom appearance before the Seoul Southern District Court, Shin's legal team presented their case with conviction.

In a surprising twist, Shin's defense accused Kwon of orchestrating external attacks on Terra, casting a shadow of suspicion over the very man who once stood side by side with Shin in the creation of Terra. They also pointed to the Anchor protocol as a significant contributor to Terra's downfall. The defense argued that Anchor's management was inherently flawed, as it onboarded users with an unsustainable business model. Anchor, a yield-generating platform built on Terra's blockchain, had lured UST depositors with promises of a 20 percent interest rate on their stablecoins, all while shielding them from the volatile cryptocurrency market.

Shin had distanced himself from Terra and Kwon in 2020, citing irreconcilable differences. However, his departure did not shield him from legal scrutiny. He now faces serious allegations, including breach of duty, embezzlement, fraud, and violation of South Korea's Capital Markets Act.

Meanwhile, Kwon, who found himself an international fugitive, could face similar charges if extradited to South Korea. The United States, in a contentious battle, is also pursuing the opportunity to try Terra's former boss. The dramatic saga reached new heights when Montenegrin police apprehended Kwon at an airport, and a judge sentenced him to four months in prison.

Kwon's arrest unfolded as he attempted to board a private flight bound for the United Arab Emirates, equipped with a forged Costa Rican passport. If tried and convicted in South Korea, Kwon could face up to 40 years behind bars, a stark contrast to his previous life as a high-flying crypto entrepreneur.

Amidst this legal turmoil, Terra has appointed a new CEO, Chris Amani, to steer the ship through these treacherous waters. On the other side of the courtroom battle, Kwon's legal team has moved to dismiss a lawsuit from the U.S. Securities and Exchange Commission, setting the stage for a legal showdown of epic proportions.

The unfolding courtroom drama between Daniel Shin and Do Kwon has captivated the cryptocurrency world, leaving many wondering about the fate of Terra and its former leaders. As the legal battle intensifies and the accusations fly, one thing remains certain: the cryptocurrency community will be watching closely as this high-stakes saga continues to play out, with the future of Terra and its founders hanging in the balance.

Read more: FTX Africa Ambassadors Under Threat: Surviving the Fallout of a Financial Collapse

Related News

Sign up for daily crypto news in your inbox

Get crypto analysis, news and updates right to your inbox! Sign up here so you don't miss a single newsletter.