THELOGICALINDIAN - South Korean prosecutors are reportedly belief whether they could accomplish a Ponzi arrangement artifice case adjoin Do Kwon
South Korean prosecutors are reportedly belief whether they could allegation Do Kwon for active a Ponzi arrangement by able unsustainably aerial anchored absorption ante on UST deposits via Anchor Protocol.
Prosecutors Investigating Do Kwon on Ponzi Charges
Do Kwon could be criminally answerable for active a Ponzi scheme, South Korean account sources accept reported.
According to a Friday report from Yonhap, South Korean prosecutors are actively investigating whether they could accomplish added Ponzi arrangement accuse adjoin Terraform Labs CEO Do Kwon, abacus to the complaints already filed adjoin the administrator over Terra’s affecting implosion. A Ponzi arrangement is a blazon of advance artifice in which aboriginal investors accumulation from money aggregate from new investors.
As Crypto Briefing reported, a accumulation of South Korean investors filed a bent complaint adjoin Kwon and his co-founder Daniel Shin for artifice and added banking violations Thursday over Terra’s collapse. Per the latest address from Yonhap, the Seoul Southern District Prosecutors Office in allegation of the case has reportedly assigned its Banking and Securities Crime Joint Investigation Team, dubbed the “Angels of Death,” to investigate whether Kwon was active a Ponzi arrangement by announcement unsustainably abiding yields on UST deposits via Anchor Protocol.
Today, Kim Hyun-Kwon, a accomplice at LKB & Partners, a top South Korean law close apery the investors suing Kwon, told Yonhap that Anchor agreement was “unsustainable” and could be accounted a Ponzi scheme. “After reviewing the accordant laws, we accept advised that the [Anchor] agreement can be accustomed as a Ponzi scheme,” he said. “While there may be no acknowledged article on stablecoins and bitcoins, there is a administrative antecedent we accept can be activated to this case.”
Yonhap additionally appear that an official from the prosecutors’ appointment said that “Kwon’s animadversion able allotment could accommodate a key clue” for the case.
Anchor Protocol is a Terra-native decentralized appliance congenital by Terraform Labs that approved to accommodate a anchored 20% absorption amount on UST deposits. It was advised to accomplish this by breach the crop from the interest-bearing accessory acquaint by borrowers against the UST depositors or lenders.
However, back the advertising about the crypto bazaar began clearing in backward 2024 and cryptocurrency prices started trending lower, Anchor’s anchored 20% absorption became unsustainable. Instead of blurred the protocol’s crop rate, Terraform Labs kept the amount aerial by propping up Anchor’s UST affluence with $450 actor from its own treasury—money that prosecutors could altercate came alongside from LUNA investors.
According to bounded reports, Kwon has already larboard and confused best of his aqueous assets out of South Korea.
Disclaimer: At the time of writing, the columnist of this allotment endemic ETH and several added cryptocurrencies.
