Key Takeaways
- South Korean authorities have asked crypto exchanges to freeze assets linked to the Luna Foundation Guard, KBS has reported.
- It comes after LFG faced questions over how it had spent its Bitcoin reserves amid Terra’s collapse.
- Terraform Labs co-founders Do Kwon and Daniel Shin are also facing a lawsuit from a group of South Korean investors in the fallout from UST’s depeg event.
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Several exchanges are due to meet with South Korea’s ruling party to discuss the Terra depeg incident, and whether they should be accountable for investors’ lost funds.
Police Investigating LFG
According to KBS, South Korean police want to freeze the Luna Foundation Guard’s assets.
Per a Monday report published by the South Korean national broadcaster, the Seoul Metropolitan Police Agency’s Cybercrime Investigation unit has asked several local exchanges to withhold funds held in wallets used by the Terra-affiliated non-profit organization. The authorities have put in the request on suspicion of misappropriation of corporate funds, the KBS report said.
It’s worth noting, however, that the exchanges are not legally obliged to freeze the funds, and so it is unclear whether they will adhere to the police’s request.
It’s only the latest development in an ongoing saga surrounding LFG, Terra, and Terraform Labs. Earlier this month, Terra suffered the greatest crash in crypto history when its UST stablecoin lost its peg to the dollar, sending…
