Terra's Kwon Do-hyung, Asked About Plans to Return to Korea: "I Have Not Been Contacted by Investigative Authorities"

Kwon Do-hyung, CEO of Terraform Labs, speaking in an interview with Coinage released on the 15th (local time). (Photo by Coinage YouTube video capture)

[Asia Economy Reporter Jeong Hyunjin] Kwon Do-hyung, CEO of Terraform Labs, the creator of the Korean-style cryptocurrency Luna and Terra, stated that he has never been in contact with Korean investigative authorities and has not confirmed whether he will return to Korea. This statement came amid reports that last month prosecutors investigating the incident conducted raids on domestic cryptocurrency exchanges and took measures to notify authorities upon Kwon's entry into the country.

According to Bloomberg News and others on the 15th (local time), Kwon made these remarks in an exclusive interview with the cryptocurrency specialized media Coinage when asked about his plans to return to Korea. Currently staying in Singapore, Kwon, who was interviewed at his office there, added, "They (Korean investigative authorities) have not indicted us on anything."

In May, investors who suffered losses from the Luna crash and Terra de-pegging (a state where the stablecoin does not maintain its $1 value) filed complaints with prosecutors accusing Kwon and co-founder Shin Hyun-sung of fraud and violations of the Act on the Regulation of Conducting Fund-Raising Business without Permission, among other charges. Subsequently, in June, prosecutors secured tax documents supporting suspicions of tax evasion by Kwon from the Seoul Regional Tax Office. On the 20th of last month, prosecutors raided domestic cryptocurrency exchanges such as Upbit, Bithumb, and Coinone to obtain transaction records of Luna and Terra. It was also reported that prosecutors took measures to notify authorities upon Kwon's entry into the country during the same month.

In the interview, Kwon said he plans to cooperate with investigative authorities when the time comes. He added, "What we will do going forward is simply to present the facts we know," and said, "We will be completely honest and will handle whatever consequences arise." When asked if he might face imprisonment due to this incident, he replied, "Life is long." Regarding his move to Singapore before the Luna and Terra crash, he said it was due to concerns for his family's safety.

Regarding the Luna and Terra crash, Kwon said, "I never once thought about what might happen to me if I failed," and explained that the Terra ecosystem, which reached a scale of $100 billion (approximately 131.2 trillion KRW) and succeeded in the market, was the basis that justified his belief. He admitted that now his belief "seems quite irrational."

Kwon denied allegations of a multi-level financial scam (Ponzi scheme), mentioning that early investors suffered the most damage. Investors claim that Terraform Labs promoted Terra deposits with an annual interest rate of 20%, which they argue was a Ponzi scheme. Although Kwon said he cannot quantify his losses, he emphasized "down infinite."