Terra Co-founder Daniel Shin’s Seoul Residence Raided by Officials

Upbit Discloses Terra Transaction Fees Utilization Plan
  • Terraform Labs gained $94 M in the year 2019.
  • Investigation happening over DoKwon regarding the TerraUSD collapse.

A raid on the Seoul residence of TerraUSD co-founder Daniel Shin, according to a Bloomberg story quoting local media, has extended an investigation into alleged unlawful conduct around the algorithmic stablecoin TerraUSD (UST) and the associated LUNC token.

Shin created the mobile payment app Chai in 2019, and investigators are said to have visited the company’s headquarters. As the first mobile payments app to use the Terra blockchain, Chai has been positioned as a way for anybody in Korea with a bank account to do cheaper transactions with local companies.

Terraform Labs(TFL) was founded in 2018 by Kwon and Shin with the intention of disrupting the payment industry, namely PayPal. In the next year, they raised an additional $32 million, and in 2019, they raised a further $62 million in an ICO.

DoKwon and TerraUSD

The other Terraform Labs co-founder, Do Kwon, took over as CEO after Shin stepped down as Terraform Labs’ chief executive officer in March 2020. According to a spokesperson for the Seoul Southern District Prosecutors Office, a raid on Shin’s house was verified, as were raids on the offices of two other companies associated with the Chai app. However, the spokesperson declined to disclose any information.

Investigations are continuing over claims that Kwon purposefully caused the collapse of TerraUSD. Instead of relying on a fiat currency, like the USD or EUR, UST relied on an algorithm that used the Luna token to create new units of UST.

Prior to their May collapse, LUNC and UST were the ninth and 10th most valuable cryptocurrencies by market capitalization, respectively; their demise cost investors over $55 billion. Seven South Korean crypto exchanges, including Upbit, Bithumb, and Coinone, were visited by a team of investigators on Wednesday, who seized transaction records and other evidence.

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