• The SEC has charged Do Kwon, the founder of Terraform Labs, with defrauding investors.
• Reports allege that Kwon cashed out over $100 million worth of Bitcoin through a Swiss bank.
• The SEC alleges that Kwon and his company committed fraud by making false and misleading statements to build trust before causing devastating losses for investors.
SEC Charges Do Kwon with Defrauding Investors
The United States Securities and Exchange Commission (SEC) recently announced charges against Do Kwon, the founder of Terraform Labs. The regulator’s complaint is that Kwon and his company orchestrated a scheme that saw him defraud investors.
Do Kwon Cashed Out Over $100M Worth Of BTC Via Swiss Bank
Do Kwon reportedly held 10,000 BTC in a cold wallet and cashed out a massive $100 million worth of Bitcoin through a bank in Switzerland. Bloomberg reports that the transfers began in June 2022 and were part of more than 10,000 BTC stashed in a cold wallet and periodically withdrawn through the Swiss-based bank.
SEC Alleges Fraudulent Transactions Continued Up To Date Of Complaint
The SEC allege the fraudulent transactions had continued up to the date of its official complaint against Do Kwon and its firm. Unlike Sam Bankman-Fried who was arrested swiftly following the collapse of his firms FTX and Alameda Research, Do Kwon continues to evade capture. An arrest warrant has been issued for his arrest but authorities have yet to apprehend him as he remains on the run from justice.
Terraform Labs & LUNA Ecosystem Impact Crypto Market Amid Intensifying Crypto Winter
The collapse of Terraform Labs’ then $40 billion LUNA ecosystem has impacted the wider crypto market amid an intensifying crypto winter. According to SEC Chair Gary Gensler, “We allege that Terraform and Do Kwon failed to provide the public with full, fair, and truthful disclosure as required for a host of crypto asset securities, most notably for LUNA and Terra USD.“ Additionally, Gensler adds that “We also allege that they committed fraud by repeating false and misleading statements to build trust before causing devastating losses for investors.“
Do Kwon Still On The Run From Justice
An arrest warrant has been issued for Do Kwan’s arrest but authorities have yet to apprehend him as he remains on the run from justice.