In spite of repeated warnings from financial regulators that doing so was illegal, Terraform Labs Pte. cofounder Daniel Shin promoted the now-defunct Terra-Luna stablecoin as a form of payment, according to South Korean prosecutors.
The Terra stablecoin would be accessible as a payment option on e-commerce platforms for people in South Korea, said Shin, whose full name is Shin Hyun-seung, on numerous occasions in 2018, local media outlet YTN reported.
However, the Financial Supervisory Service repeatedly informed Shin that, in accordance with the Electronic Financial Transactions Act, virtual assets could not be registered as a payment method, according to the newspaper.
Forkast received confirmation from Choi Sung-kook at the Seoul Southern District Prosecutors’ Office that the prosecutors are considering charging Shin with fraud under the Capital Markets Act and issuing an arrest warrant. This information was included in the YTN report.
Together with Kwon Do-hyung, or Do Kwon, Shin established Terraform Labs in 2018, which produced the Terra-Luna stablecoin. The company’s chief executive officer was Do Kwon.
Terra-Luna, which failed in May of this year and resulted in losses for hundreds of thousands of investors worldwide, is being looked into by South Korean authorities. The location of the CEO of Terra is unknown, despite the fact that they have issued an arrest warrant for Do Kwon and are working with Interpol to find him.