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South Korean Prosecutors Raid Terra Co-Founder's Company in UST Probe
Officials said they suspect Chai Corp. leaked customer information to Terraform Labs.
Updated Nov 16, 2022, 12:25 p.m. Published Nov 16, 2022, 11:58 a.m.
South Korean prosecutors investigating the collapse of the terraUSD (UST) algorithmic stablecoin raided the headquarters of Chai Corp., whose CEO Daniel Shin was a co-founder of Terraform Labs.
The Tuesday raid on the Seoul-based payment services company was conducted by the Seoul Southern District Prosecutor's Office's Financial and Securities Crime Joint Investigation Team.
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The value of UST fell to zero after it lost its peg to the dollar, and the subsequent contagion across the crypto industry led to numerous lenders, brokers and exchanges filing for bankruptcy protection. In April a South Korean court issued an arrest warrant for Terra's CEO Do Kwon, whose location is unknown, along with five others. Officials have also raided seven cryptocurrency exchanges in South Korea as part of a fraud probe in connection with the now defunct coins.
"Prosecutors suspect that Chai Corporation leaked customer payment information to Terraform Labs without permission in the process of launching the Terra payment service in 2018," according to a statement sent to CoinDesk.
This isn't the first time Shin has been targeted. Officials raided his home in July as part of the same investigation.
See also: Luna Foundation Guard Spent $2.8B Defending UST Peg, Third-Party Audit Finds
UPDATE (Nov. 16, 12:25 UTC): Adds dropped word in third paragraph.
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