South Korean Prosecutors Launch New Investigation Into Terraform Labs

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South Korean Prosecutors Launch New Investigation Into Terraform Labs:

After the Terra/UST $60 billion fiasco, so many security bodies carried out investications on the blockchain platform.

For a while now, everything seems to be on cold not until South Korean prosecutors revealed their plans to launch a fresh investigation into the firm and its executives.

According to a recent report by the Korean Herald, the Financial and Securities Crime Joint Investigation Team of the Seoul Southern District Prosecutors Office has talked with several crypto experts and financial watchdogs to investigate Terra tokens.

In line with the report, Korean prosecutors aim to determine the category of Terra’s digital assets, whether they are securities.

This includes its native token, LUNA.

For long now financial regulators have been working to determine the category of crypto assets as it relates to securities and non-securities.

While several experts argue that cryptocurrencies are securities since they can be issued like stocks, others believe they should be classified as a commodity due to their decentralized characteristics.

However, if Terra tokens are confirmed to be securities after the investigation, TerraForm Labs, its founder Do Kwon, and other executives will be charged with violating the Capital Market Act.

Currently the firm and its executives are facing fraud and tax evasion charges filed against them following the UST Fiasco earlier in May, resulting in the loss of over $60 billion in investors’ funds.

The latest development is still seen as efforts by South Korean prosecutors towards Terra’s probing.

Since then, Korean authorities have scrutinized several individuals and entities linked to the Terra case.

Earlier in July, the prosecutors raided the house of Terraform Labs’ co-founder, Daniel Shin, as part of ongoing investigations.

Meanwhile, some people are optimistic about the new development as they feel it would also help policymakers develop the country’s legal framework for crypto regulation.

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