Key Takeaways
- Adding to criminal complaints from a group of South Korean investors, prosecutors are reportedly investigating Terraform Labs CEO Do Kwon on Ponzi charges.
- The prosecutors are scrutinizing whether Terraform Labs’ Anchor Protocol, which promised investors fixed 20% interest on UST deposits, was a Ponzi scheme.
- The investigation follows Terra’s $40 billion collapse last week.
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South Korean prosecutors are reportedly weighing whether they could charge Do Kwon for running a Ponzi scheme by promising unsustainably high fixed interest rates on UST deposits via Anchor Protocol.
Prosecutors Investigating Do Kwon on Ponzi Charges
Do Kwon could be criminally charged for running a Ponzi scheme, South Korean news sources have reported.
According to a Friday report from Yonhap, South Korean prosecutors are actively investigating whether they could make additional Ponzi scheme charges against Terraform Labs CEO Do Kwon, adding to the complaints already filed against the entrepreneur over Terra’s dramatic implosion. A Ponzi scheme is a type of investment fraud in which early investors profit from money gathered from new investors.
As Crypto Briefing reported, a group of South Korean investors filed a criminal complaint against Kwon and his co-founder Daniel Shin for fraud and other financial violations Thursday over Terra’s collapse. Per the latest report from Yonhap, the Seoul Southern District Prosecutors Office in charge of the case…
