Authorities raid South Korean crypto exchanges in Terraform Labs probe

Authorities raid South Korean crypto exchanges in Terraform Labs probe
2 months ago
2 mins read

As the scandal involving Terraform Labs continues to draw attention across the cryptocurrency sector, the South Korean authorities continue to carry out activities for the purpose of untangling the suspected fraud case.

In the most recent development, a team of investigators from the Seoul Southern District Prosecutors Office raided several local cryptocurrency exchanges, including Upbit, on July 20, Korean news outlet Yonhap News Agency reported.

Specifically, the raids included seizing transaction records and other material considered valuable in the investigation of the circumstances that led to the demise of Terraform’s digital coins, TerraUSD (USTC) and LUNA, and significant losses that ensued for the investors.

Terraform plot thickens

In late May, Terraform Labs’ CEO Do Kwon was accused by a crypto whistleblower of a massive fraud using the Mirror Protocol created by Terraform Labs. Not long after that, the company was accused of money laundering through a South Korean shell company in an elaborate scheme involving a “blockchain consulting firm K” based in Seoul.

At the same time, South Korean authorities launched an investigation into one of the firm’s employees over Bitcoin (BTC) embezzlement that allegedly happened in May 2021, although no link was found between the suspect and Do Kwon.

On top of that, new research carried out by blockchain security company Uppsala Security and CoinDesk Korea has supported the claims of those who believe that the collapse of the Terra ecosystem may have been an inside job.

As part of its investigation, the Seoul Southern District Prosecutor Office’s Joint Financial and Securities Crime Investigation Team imposed a departure ban on Mr. A, one of Terra’s key designers, Finbold reported in late June.

Meanwhile, South Korea’s Minister of Justice Han Dong-hoon has met with United States officials at the U.S. Attorney’s Office for the Southern District of New York, in order to examine the possible methods by which the two countries could work together to investigate crimes involving crypto, such as the one pertaining to the Terraform Labs case.

Latest News

Join us on Twitter or Telegram

Or follow us on Flipboard Flipboard

Like the article? Vote up or share on your social media

Recommended content

Weekly Finance Digest

By subscribing you agree with Finbold T&C’s

Ana Nicenko

Ana Nicenko has a plethora of knowledge and experience as a journalist covering the cryptocurrency and blockchain industries, having written for a variety of projects and organizations. Additionally, Ana has a master's degree in English Language and Literature. At Finbold, she reports news on the digital assets sector.