South Korean Prosecutors Launch Investigation on All Terraform Labs Employees Following UST Collapse 14
Terra (LUNA) crypto currency token logo on coin technology themed design

South Korean Prosecutors Launch Investigation on All Terraform Labs Employees Following UST Collapse

  • South Korean prosecutors have summoned Terraform Labs employees for a thorough investigation, local reports say.
  • They also want to investigate whether Do Kwon manipulated prices.
  • These new investigations are taking place as Terra tries to revive itself with a new blockchain.

South Korean authorities have begun a thorough investigation of Do Kwon and Terraform Lab employees, according to local media. The joint financial and securities crime investigation team of the Seoul Southern District Prosecutors’ Office summoned employees of the companies to learn if they were aware of a potential collapse.

The report says that the prosecutors secured a statement saying that there were some reservations against “the launch of Luna and Terra because the pilot model failed within the company at the time.” The prosecutors believed that the asset was launched and marketed in spite of this. They have reportedly subpoenaed all Terraform Labs employees so that they can conduct a thorough investigation.

Prosecutors are also looking into whether Do Kwon manipulated prices and whether the asset went through a proper listing review process. The questioning of employees could offer a fuller picture of what exactly happened behind the scenes and whether those at the top were really aware that things could fall apart.

The number of people filing complaints against Terraform and Do Kwon continues to rise. Numerous lawsuits have been filed against those related to the Terra project. Lawmakers have also entered the fray, seeking to hear from Kwon before Congress, and law enforcement has asked local exchanges to freeze assets belonging to the Luna Foundation Guard.

Terra Attempts to Reboot With LUNA 2.0

Whether or not these allegations are proven true, the Terra ecosystem finds itself in a deep spot of trouble. Those in charge are carrying out multiple strategies to lift themselves back into action, but it doesn’t look like it will come easy.

Amidst all of this, Terra has launched Luna 2.0, a bid to revive the Terra ecosystem. It has not worked out as well as they would have liked, with the new LUNA token crashing by nearly 80% following launch. Many investors appear to be selling in order to recover some of the losses experienced from the crash.

Terraform Labs revive Terra
Terra price: CoinMarketCap

Adding to the woes is the fact that some South Korean exchanges are wary of listing the new LUNA token. The team might say that Terra 2.0 is the birth of a new blockchain, but investors remain skeptical. However, as the investigations proceed, Terra is going to have a rough time clawing its way back up.