Summary:
- The Terra Classic cryptocurrency created by Do Kwon does not classify as a security, a South Korean District Court ruled in February after a similar ruling back in November last year.
- South Korean prosecutors requested a judgment from the country’s supreme court after the latest ruling.
- Both Kwon’s attorneys and a South Korean court have not contested whether LUNA Classic counts as a security, per reports.
- The U.S. SEC said LUNC was a security in a fraud lawsuit against Do Kwon in February week before his arrest by Montenegrin police.
The Terra Classic cryptocurrency created by Do Kwon does not classify as a security, a South Korean District Court ruled in February after a similar ruling back in November last year.
According to South Korean news house Ilyo Shinmun, the Seoul Southern District Court ruled twice on the matter. Once on November 15, and again on February 16. Both instances were reported for the first time today, the reason being unclear.
Based on the data submitted by the prosecution, it is difficult to say that Luna falls under the financial investment product regulated by the Capital Markets Act.
– Seoul Southern District Court.
Prosecutors in South Korea are now seeking a judgment from the country’s Supreme Court on whether the renamed LUNA CLASSIC or LUNC is a security under the Capital Markets Act.
Authorities are unable to seize assets controlled by Daniel Shin following the ruling. Shin, co-founder of Terraform Labs, was the focus of an asset manhunt where prosecutors hoped to seize $100 million for Shin’s alleged part in Terra’s $40 billion crash.
Do Kwon’s LUNC A Security Or Not, Authorities Debate
South Korean authorities seemingly consider establishing Terra Classic’s security status as a front boiler topic in the case against Do Kwon. Kwon’s lawyers have also contested claims that LUNC is a security, albeit arguing that they are not to disarm authorities intending to sue Kwon for securities fraud.
The U.S. Securities and Exchange Commission also called Do Kwon’s Terra Classic a security in a fraud lawsuit filed against Kwon in February. According to the SEC, LUNC and its sister token TerraUSD (UST), Kwon’s algorithmic stablecoin, qualify as securities as investors held expectations of profit from secondary-party efforts.