In an interview with The Wall Street Journal, Kwon said, “I have great confidence in our ability to be even stronger than we were before.”
Earth The initial coins of UST and Luna were like eye candy in the crypto market in the months since their launch in 2018. The UST stablecoin is pegged to the US Dollar, South Korean Won, Mongolian Tugrik and the International Monetary Fund. Special Drawing Rights basket of currencies. It had a one-to-one peg through an algorithm and should never have dropped below the $1 mark. The coins had a promising picture at the time and were supported by several crypto exchanges, including Binance and Coinbase.
But everything fell apart in early May when cryptocurrency The market was forming a unique trading pattern which coincided with the movement of the stock market. The correlation between the decline in the crypto market tracking the decline of equities over these two months due to macroeconomic woes has only grown so far.
The decline in Terra’s coins was intense and even mind boggling, investors couldn’t wrap their heads around the Flash crash, which resulted in UST eroding its peg and falling over 99%, while its Luna did. most brutally beaten. Zero level – resulting in a $40 billion crash.
Free fall in Terra Sisters also dragged on the broader crypto market, with leaders such as Bitcoin and Ethereum also facing the heat and seeing huge corrections. The crash also caused a huge drop in other stable coins such as Tether.
Moreover, the flash crash caused huge turmoil among investors. Do Kwon was immediately convicted and many people accused him of fraud. Kwon received criticism for his plans from renowned Binance founders Changpeng Zhao and Vitalik Buterin, as well as from disgruntled UST investors.
Zhao also revealed on his Twitter how much damage was done in the Terra crash.
According to Zhao, during the year 2018, Binance LUNA received 15 million tokens for its $3 million investment in the Terra Network. At its peak in April this year, investment in stablecoins reached $1.6 billion. However, Zhao did not sell Luna and when the stablecoin crashed to the zero threshold – the tokens were only worth a few dollars in May.
According to the aforementioned US newspaper, Do Kwon is facing lawsuits. Groups representing more than 90 people in South Korea have filed complaints against Kwon alleging fraud and illegal fundraising. Additionally, a US law firm representing a Chicago-based investor has filed suit against Kwon, his company Terraform Labs and several other firms alleging fraud and the sale of unregistered securities.
While an investor also reached their home in Seoul, and according to local media reports, rang his doorbell, prompting Kwon’s wife to seek police protection.
In the latest news, several Terraform Labs have been put on the no-fly list amid the lawsuit.
As Reuters reported on Wednesday, an official at South Korea’s Supreme Prosecutor’s Office, who declined to be the customary name in South Korea, said several employees of Terraform Labs had been put on a no-fly list. However, a Terraform Labs spokesperson said in a statement, “We are not aware of the details of the alleged ban.”
On the allegations, Kwon said that he personally lost money in the accident.
In the interview, Kwon said, “I made confident bets and made confident statements on behalf of UST because I believed in its flexibility and its value proposition.” He continued, “I have since lost these bets, but my actions 100% match my words. There is a difference between failing and running a fraud.”
Kwon continued in the interview, “I am devastated by the recent events and hope that all the families affected are taking care of themselves and their loved ones.”
When asked about being a billionaire, when LUNA traded closer to $100, Kwon said that was probably the case, although he “never really counted”. He, however, said that he lost almost all his net worth in the accident.
Talking about his monetary loss, Kwon said, it doesn’t bother him, and added. “I live a very frugal life.”
Terra which is a blockchain protocol using fiat-pegged stablecoins was founded in January 2018 by Daniel Shin and Do Kwon. However, it was launched in April 2019. The token LUNA was first made available to initial investors in a private token sale in August 2018, before it went on the market for public trading, and raised a whopping $32 million from investors such as Binance, OKEx. , and Huobi.
Since its inception, TerraForm Labs has raised more than $200 million from investors including Coinbase Ventures and Mike Novogratz’s Galaxy Digital Holdings, according to PitchBook. The latest deal was $150 million as an early-stage VC in July last year. There are around 46 investors in Terraform Labs so far.
Binance is one of the many investors who have suffered huge losses in the Terra crash.
Last month, Binance announced the termination of Tera from trading on its app and wallet. However, during the Terra 2.0 launch, Binance announced that they are working closely with the Terra team on a recovery plan, which aims to provide the best possible treatment to affected users on Binance.
After successful voting, Kwon was able to launch Terra 2.0 on 27 May, where the original Terra series is rebranded as Terra Classic, while a new series with the existing name Terra is created and available for trade. has been conducted.
Under the rebranded Terra Classic, the original Universe series will still run, however, with the market swap (Mint/Burn function) disabled. Other than that, all remainders will remain the same. Luna has become Luna Classic (LUNC). In addition, the Terra stablecoins (UST, KRT, EUT, etc.) have been renamed to the Terra Classic stablecoins (USTC, KRTC, EUTC, etc.).
The new range Terra has assumed all the properties of the Terra branding. Notably, Terra is also a universe series, however, the original series will not have a treasure, oracle, or market module. The original mining token of the new chain is called Luna. In addition, the Terra stablecoins (UST, KRT, EUT, etc.) will not be included in the new chain.
According to data from Coingecko, Terra LUNA traded at around $1.96 on Thursday, up 0.4% with a market cap of $247,607,167. The new LUNA reached an all-time high of $18.87 on May 28 before correcting. The loss is around 90% from its peak level of last month, but that too due to de-pegging.
Terra LUNA saw an all-time low of $1.66 on June 18, and has since gained almost 18%.
Meanwhile, Terra Classic was trading at $0.00005819, up 1.6%. Its high was $125.85 on March 31, 2022, and fell 100%. However, from its all-time low of $0.00000119 on May 13, the coin is up 4,886.9%.
Currently, Terra Classic has a weekly gain of over 93%. In the last 14 days, the profit is over 26%.
The modified Terra Token has found significant support and the new LUNA is expected to gain further value.
“Many builders are in the process of relaunching their apps on the new series,” Kwon said in the interview.
Prior to TerraLabs, Kwon previously founded and served as CEO of Anyfi, a startup that provides decentralized wireless mesh networking solutions. In addition, he has worked as a software engineer for IT giants such as Microsoft and Apple.
Earlier this month, Rajagopal Menon, Vice President of WazirX on Crypto Crash, said, “Crypto markets have seen a correction due to weak global cues. Internationally, the stock and crypto markets have become highly correlated. Inflation globally. The rate has also been a major concern for investors. In the US, it is at a 40-year high at 8.6% and in the UK at 9%; Interest rate hikes in major crypto countries are also a growing concern as they spur liquidity. Both the indicators have led to a massive sell-off.”
“Therefore, investors have taken a wait-and-watch approach as early indicators are in the red. We expect this bearish market to continue in the near term,” Menon said.