SEC Could Access Singapore Records In Terra Founder Investigation

Table of Contents

• Do Kwon’s Request Denied
• Enforcement Action From All Over
• UST/LUNA Crash

The records of the Luna Foundation Guard and Do Kwon’s operations, which have been stored with the Monetary Authority of Singapore (MAS), can now be accessed by the U.S. Securities and Exchange Commission.

Do Kwon’s Request Denied

Do Kwon can not hide the records of his Singapore operations behind the MAS curtain anymore. In a recent ruling, the SEC was granted permission to access the records of the Luna Foundation Guard (LFG) from the country’s central bank. The ruling will allow the SEC to seek records from the MAS that could provide more insight into the management of the LFG and the role of Do Kwon in the LUNA/UST collapse that unraveled the market in 2022. 

Do Kwon had requested US Judge Jed Rakoff to prevent the SEC from accessing data related to his operations stored at the MAS. However, the District Judge denied his request, making it feasible for the SEC to get valuable information. According to reports, this information includes records of the initial establishment of the non-profit organization behind the collapsed Terra ecosystem and the funds raised by it to maintain the dollar peg of the algorithmic stablecoin Terra (UST). 

Enforcement Action From All Over

Multiple regulatory bodies, law enforcement agencies, and prosecutors have claimed that Do Kwon was to be held accountable for the billions of dollars of valuation loss as he was the mastermind behind the orchestrated incident. In February 2023, the SEC filed a lawsuit against him on charges of fraud and unregistered securities trading, which led to billion-dollar losses for investors. 

Do Kwon is also facing legal action from New York prosecutors as well facing FBI investigations. Plus, he is also undergoing investigations from South Korean and Singaporean authorities. After being hard to find for several months, he was recently arrested in Montenegro, where he remains waiting for extradition. 

UST/LUNA Crash

In May 2022, the Terra stablecoin lost its dollar peg and took a nosedive way below its price target. The native token of the Terra platform, LUNA, was closely connected with the stablecoin. As a result, users started minting more LUNA to gain some equilibrium. However, this, in turn, led to an infinite arbitrage loop, and both the tokens plummeted down and hit rock bottom. 

This resulted in a market-wide meltdown and billions of dollar worth of losses. Several other companies exposed to UST/LUNA also took a hit and toppled into bankruptcy. 

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.