Following the collapse of Terra, further investigative actions were taken by the South Korean authorities. Seven bitcoin exchanges were among the 15 companies that South Korean authorities investigating Terraform Labs searched and seized.
The offices of Upbit, Bithumb, Coinone, Korbit, and Gopax, as well as other companies connected to the collapse of Terra, were raided by the Joint Financial and Securities Crime Investigation Team of the Seoul Southern District Prosecutors Office, according to a report published on Wednesday by News1 Korea.
Authorities allegedly collected information on TerraUSD (formerly UST) and LUNA transactions, which resulted in losses for almost 200,000 Korean investors after the tokens’ significant price devaluation and subsequent collapse in May.
Few Terra victims appointed local law firms
Some of the victims of Terra’s collapse and UST’s de-pegging apparently hired local law firm L.K.B. & Partners to represent them in a lawsuit against LUNA and its co-founder Do Kwon on the grounds that the business committed fraud.
More than 100 people who allegedly incurred losses totaling more than $8 million filed complaints with the prosecutor’s office.
According to a representative for L.K.B & Partners, “The defendants did not adequately notify about design faults and deficiencies in the algorithm when building and releasing Luna in a conspiracy to attract investors.”
The bankruptcy of Do Kwon’s firm and the events that followed it, despite the company’s headquarters being in South Korea, significantly affected the cryptocurrency sector.
Investors impacted by the UST and LUNA fiasco in the United States hinted at taking legal action against yield generating program Stablegains for allegedly misappropriating $44 million in deposited cash.