The US Department of Justice is investigating the TeraUSD stablecoin collapse.
The collapse of the TeraUSD stablecoin, one of the most busy events of 2022, is being investigated by the US Department of Justice. Within the scope of the research, the FBI and New York officials are working together.
US Justice Department Investigates Do Kwon’s TeraUSD Collapse
In 2022, the waters in the crypto money industry have never calmed down. The collapse of TeraUSD, one of the biggest reasons for the price drop, is being investigated by the US Department of Justice.
According to sources familiar with the matter, the Ministry of Justice is investigating the collapse of the TerraUSD stablecoin last year. Added to the pressure on Do Kwon, the South Korean entrepreneur, the creator of stablecoin, is the risk of US criminal prosecution.
The Federal Bureau of Investigation and the Southern District of New York questioned former team members of Mr. Kwon’s company, Terraform Labs Pte.
The Securities and Exchange Commission filed a civil fraud lawsuit against Do Kwon and Singapore-based Terraform Labs in Manhattan federal court last month. The lawsuit accused Do Kwon and the firm of misleading investors about the risks of TerraUSD. The cryptocurrency lost its peg in May 2022. This resulted in the destruction of its market value of approximately $40 billion. This led to a chain collapse that cost some investors their savings.
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