During his trial in May 2022, Daniel Shin, the co-founder of the defunct stablecoin issuer Terraform Labs, held former CEO Do Kwon accountable for the company’s bankruptcy. Because of his connection to the multibillion-dollar cryptocurrency business, Shin was accused by South Korean authorities in April on charges of breaking capital-markets law. Shin “parted ways” with co-founder Kwon in 2020, according to Shin’s lawyer, who also confirmed the departure at the South Korean trial. Shin had departed the company two years prior to the failure.
“External attacks and CEO Kwon’s irrational adoption of the Anchor Protocol were the root causes of the coin collapse. According to reports, a lawyer stated that it is unrelated to Shin. A lending mechanism called Anchor Protocol was developed on Terra to enable investors to borrow money against their cryptocurrency holdings and receive high rates on their deposits. Prior to the collapse, the terraUSD (UST) stablecoin lost its peg to the US dollar, which caused deposits on Anchor to plummet and exacerbated the problem. While Kwon is imprisoned in Montenegro for possessing forged documents, Shin is on trial in South Korea. Kwon may be extradited to the United States or South Korea upon the completion of his sentence in the European nation.
