Terraform Labs Faces Lawsuit for Selling Unregistered Securities
The crypto economy’s digital assets have seen significant gains this month, but Terra’s Luna 2.0 has been stagnant as it has dipped 24.37% against bitcoin
during the last 30 days. LUNA is down 89.8% from the token’s all-time price
high two months ago, on May 28. The whistleblower Fatman has revealed that
victims of the Terra collapse have filed a class-action lawsuit against
Terraform Labs, Do Kwon, and Nicholas Platias.
Whistleblower Fatman to Pursue Terra Lawsuit
On July 26,
the whistleblower Fatman (@Fatmanterra on Twitter) shared a sign-up link
for investors who were affected financially by the Terra collapse in mid-May.
The case is being handled by the litigation firm Scott+Scott and the defendants
include Terraform Labs (TFL), Nicholas Platias, and Do Kwon. Jump Crypto, Jump
Trading, Republic Capital, Republic Maximal LLC, Tribe Capital, Definance
Capital, GSR Markets Limited, Three Arrows Capital (3AC), and the Luna
Foundation Guard (LFG) are included.
The
whistleblower complimented Do Kwon’s intellect but noted that the Terra
co-founder did not use it for good. "Instead of using his genius for good,
Do used it to create a scheme so convincing, ingeniously mixing in real utility
with sheer lies, that it not only led to the downfall of thousands of investors
but also some big funds who had been hoodwinked despite solid research," Fatman
remarked in the thread. He added,
"We will
be joining the class action lawsuit filed in the U.S. by the international law
firm Scott+Scott. We are also preparing actions in other jurisdictions. We
demand a fair trial to uncover all of TFL [and] Do Kwon’s wrongdoings so that
justice can take its course. "
South Korean Authorities Investigate Terra Co-Founders
The Luna 2.0
token, called LUNA, has not been performing as well as most of the crypto
economy. LUNA has lost 24.37% against bitcoin (BTC) since last month and 9.62%
against the USD in the same period. Out of 13,099 crypto coins in existence,
LUNA is ranked 148 with its USD 261.63 million market valuation. Since LUNA’s
all-time high on May 28, when it reached USD 18.87 per unit, LUNA has lost
89.8% in USD value.
LUNA has
significant exposure to tether (USDT) pairs as cryptocompare.com statistics
indicate that USDT represents 77% of all LUNA’s trades during the
last 24 hours. USDT is followed by USDC (11.43%), TRY (9.57%), USD
(0.68%), and EUR (0.37%). Additionally, LUNA’s total value locked (TVL) in the
world of decentralized finance (defi) is USD 26.88 million, while over USD 12
million is held in defi protocols on the Terra Classic chain. In addition to
the Scott+Scott lawsuit, Terra’s co-founder Daniel Shin is banned from leaving
South Korea.
South Korean
law enforcement officials are investigating TFL, Shin, and Kwon, and
Fatman has said a rough translation of the article details that "the
prosecutor also brought up the possibility of cooperating with Interpol to
issue a Red Corner Notice for Do Kwon’s extradition." The
class-action complaint published by Scott+Scott claims all of the
Terra tokens TFL has issued are unregistered securities and that TFL never
registered with the Securities and Exchange Commission (SEC). The
whistleblower stressed that it was hard to convey how badly some
Terra investors were affected by the collapse. Fatman’s Twitter thread
concluded by noting:
"It’s
time to take matters into our own hands. I’m sick of seeing our space invaded
by scammers who think they can brazenly rob thousands of innocents and get away
with it. People like Do Kwon make this industry rotten. It’s time for a purge
so crypto can be reborn anew. "
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