Prosecutors Claim Do Kwon Has Millions in Swiss Bank Account

Prosecutors Claim Do Kwon Has Millions in Swiss Bank Account

Prosecutors in Seoul are convinced that Terraform Labs co-founder Do Kwon has millions in his Swiss bank account. They have information about Do Kwon having a considerable sum of money, specifically 130 billion won (USD 100 million), held in Sygnum Bank in Switzerland. Legal proceedings have been initiated against ten associates of Terraform Labs, including the co-founder, Shin Hyun-Seong, known to many as Daniel Shin.

USD 100 Million Allegedly Transferred to Sygnum Bank

Park Beom-soo has reportedly filed a report following the Terraform Labs indictment that Do Kwon and his associates have allegedly transferred 10,000 bitcoin (BTC) to a fintech bank in Switzerland. The recipient of the sizable transfer is Sygnum Bank, a digital asset bank in Zurich. The Seoul Southern District Prosecutor’s Office has been closely monitoring the movement of Terra-linked bitcoin and revealed the information during a press conference held on the recent indictment.

The official spokesperson in the prosecutor’s office stated, "We are actively tracking the bitcoin owned by LFG (Luna Foundation Guard), but some of it has been converted into cash and deposited in the Sygnum bank account. As the SEC complaint outlined, the amount transferred is approximately 100 million dollars (about 130 billion won)." The investigation into Terraform Labs and Do Kwon’s financial dealings is in progress, and further details are awaited on the matter.

LFG "Failed to Account for the Trail of Bread Crumbs"

The Luna Foundation Guard (LFG), an organization created to defend the blockchain stablecoin UST’s dollar peg, accumulated massive amounts of bitcoin. The funds were supposed to protect the UST from dropping below USD 1 parity. LFG and Terra co-founder Do Kwon somehow failed to prevent the collapse. It was speculated that LFG did not use all the funds to defend against the stablecoin collapse. LFG tried to save face by releasing an audit that claimed the group used more than 80,000 BTC to defend the coin’s peg.

However, OXT researcher Ergo BTC discovered that the blockchain "tells a different story" in a Twitter thread from October 2022. Ergo said that while LFG may have declared ownership of a single wallet holding 313 BTC, their actions have left a breadcrumb trail of evidence that can be tracked. Ergo discovered a group of fifteen significant Binance withdrawals made to a single address. The coins were then consolidated and used in a series of transactions spanning several months. Shortly after the first withdrawal from Binance, 665 BTC were spent on Kucoin, and on May 16, the remaining 313 BTC were transferred to the new LFG address, providing further evidence of the association.

Ergo further said that the sequence of transactions continued for many months and that "unfortunately for the LFG, the reused addresses were active before the depeg event, providing additional clues for investigators." The researcher further added that while the LFG may argue that the pseudonymity of BTC provides them with a veil of anonymity, it is clear that the activity the researcher observed is "directly related to the funding of the LFG treasury." Park Beom-soo’s report further confirmed to Ergo that the onchain activity of the OXT researcher aligns more closely with the Seoul prosecutor’s report than the Do Kwon and the LFG audit stories.

What is your take on the investigation into Terraform Labs and the allegations that co-founder Do Kwon has USD 100 million in a Swiss bank account? Please post your comment.