TechDigits

Tech news
Monday, May 20, 2024

Do Kwon: US regulator charges 'cryptocrash' boss with fraud

Do Kwon: US regulator charges 'cryptocrash' boss with fraud

US financial regulators have charged failed South Korean cryptocurrency boss Do Kwon and his company Terraform Labs with "orchestrating a multi-billion dollar crypto asset securities fraud".
The Singapore-based firm created the Terra Luna and TerraUSD tokens, which collapsed spectacularly last year.

The collapse is estimated to have cost investors more than $40bn (£33.5bn).

Mr Kwon and Terraform Labs did not immediately respond to a BBC request for comment.

"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 TerraUSD," US Securities and Exchange Commission (SEC) chairman Gary Gensler said in a statement.

"We also allege that they committed fraud by repeating false and misleading statements to build trust before causing devastating losses for investors," he added.

According to the SEC, Mr Kwon and his company raised billions of dollars from investors by selling them "an interconnected suite of crypto asset securities" with many transactions being unregistered.

The SEC also alleged Mr Kwon and Terraform claimed repeatedly that the tokens would increase in value, and misled investors about the stability of TerraUSD.

However, the value of the token and its linked Luna cryptocurrency plunged to close to zero in May last year.

Globally, investors in TerraUSD and Luna lost an estimated $42bn, according to blockchain analytics firm Elliptic.

It triggered a sell-off in major cryptocurrencies such as Bitcoin, Ethereum and Tether. As a result the term cryptocrash trended online.

"I am heartbroken about the pain my invention has brought on all of you," Mr Kwon said at the time.

The SEC complaint, which included other allegations, did not state where Mr Kwon was located.

In December, South Korean authorities, who have issued an arrest warrant for Mr Kwon, said they believed he was in Serbia.

Mr Kwon had previously denied that he was in hiding, but did not reveal his whereabouts.

"For any government agency that has shown interest to communicate, we are in full cooperation and we don't have anything to hide," he said on Twitter.

Mr Kwon faces charges of fraud and breaches of capital markets law in his home country of South Korea.
Newsletter

Related Articles

TechDigits
0:00
0:00
Close
FTX's Bankman-Fried headed for jail after judge revokes bail
America's First New Nuclear Reactor in Nearly Seven Years Begins Operations
Southeast Asia moves closer to economic unity with new regional payments system
Today Hunter Biden’s best friend and business associate, Devon Archer, testified that Joe Biden met in Georgetown with Russian Moscow Mayor's Wife Yelena Baturina who later paid Hunter Biden $3.5 million in so called “consulting fees”
Google testing journalism AI. We are doing it already 2 years, and without Google biased propoganda and manipulated censorship
Musk announces Twitter name and logo change to X.com
The future of sports
TikTok Takes On Spotify And Apple, Launches Own Music Service
Hacktivist Collective Anonymous Launches 'Project Disclosure' to Unearth Information on UFOs and ETIs
Typo sends millions of US military emails to Russian ally Mali
Server Arrested For Theft After Refusing To Pay A Table's $100 Restaurant Bill When They Dined & Dashed
Democracy not: EU's Digital Commissioner Considers Shutting Down Social Media Platforms Amid Social Unrest
Sarah Silverman and Renowned Authors Lodge Copyright Infringement Case Against OpenAI and Meta
Why Do Tech Executives Support Kennedy Jr.?
The New York Times Announces Closure of its Sports Section in Favor of The Athletic
Florida Attorney General requests Meta CEO's testimony on company's platforms' alleged facilitation of illicit activities
The Poor Man With Money, Mark Zuckerberg, Unveils Twitter Replica with Heavy-Handed Censorship: A New Low in Innovation?
The Double-Edged Sword of AI: AI is linked to layoffs in industry that created it
US Sanctions on China's Chip Industry Backfire, Prompting Self-Inflicted Blowback
Meta Copy Twitter with New App, Threads
BlackRock Bitcoin ETF Application Refiled, Naming Coinbase as ‘Surveillance-Sharing’ Partner
UK Crypto and Stablecoin Regulations Become Law as Royal Assent is Granted
A Delaware city wants to let businesses vote in its elections
Alef Aeronautics Achieves Historic Milestone with Flight Certification for World's First Flying Car
Google Blocked Access to Canadian News in Response to New Legislation
French Politicians Advocate for Pan-European Regulation on Social Media Influencers
Melinda French Gates Advocates for Increased Female Representation in AI to Prevent Bias
Snapchat+ gains 4 million paying subscribers in its first year
Apple Makes History as the First Public Company Valued at $3 Trillion
Elon Musk Implements Twitter Limits to Tackle Data Scraping, but Faces Criticism for Technical Misunderstanding
EU and UK's Slow Electric Vehicle Adoption Raises Questions About the Transition to Green Mobility
Top Companies Express Concerns Over Europe's Proposed AI Law, Citing Competitiveness and Investment Risks
Meta Unveils Insights on AI Usage in Facebook and Instagram, Amid Growing Calls for Transparency
Crypto Scams Against Seniors Soar by 78% in 2022, Experts Urge Vigilance
The End of an Era: National Geographic Dismisses Last of Its Staff Writers
Shield Your Wallet: The Perils of Wireless Credit Card Theft
Harvard Scientist Who Studies Honesty Accused Of Data Fraud, Put On Leave
Putting an End to the Subscription Snare: The Battle Against Unwitting Commitments
The Legal Perils of AI: Lawyer Faces Sanctions for Relying on Fictional Cases Generated by Chatbot
ChatGPT’s "Grandma Exploit": Ingenious Hack Exposes Loophole in AI, Generates Free Software Codes
The Disney Downturn: A Near Billion-Dollar Box Office Blow for the House of Mouse
A Digital Showdown: Canada Challenges Tech Giants with The Online News Act, Meta Strikes Back
Distress in the Depths: Submersible and Passengers Missing in Titanic Wreckage Expedition
Mark Zuckerberg stealing another idea: Twitter
European Union's AI Regulations Risk Self-Sabotage, Cautions smart and brave Venture Capitalist Joe Lonsdale
Nvidia GPUs are so hard to get that rich venture capitalists are buying them for the startups they invest in
Chinese car exports surge
Reddit Blackout: Thousands of Communities Protest "Ludicrous" Pricing Changes
Nvidia Joins Tech Giants as First Chipmaker to Reach $1 Trillion Valuation
AI ‘extinction’ should be same priority as nuclear war – experts
×