TechFlow news — The Seoul Southern District Prosecutors' Office's joint investigation team for financial and financial securities crimes has summoned all employees of Terraform Labs, the developer behind Luna and Terra, for questioning and obtained relevant documents.
According to sources, these employees participated in the initial development of Luna and Terra in 2019. Prosecutors have obtained testimony indicating that despite internal opposition, Do Kwon forcibly launched the token. Former employees stated that some had objected because the pilot model had already failed internally at the company. At the time, concerns were raised that offering double-digit interest rates to investors without stable collateral or a sustainable profit model might initially attract a surge of participants, but would inevitably collapse at some point due to unsustainable interest payments and volatility.
Prosecutors are examining whether Do Kwon and other Terraform Labs executives were aware in advance of the design flaws in Luna and Terra. Additionally, prosecutors will investigate whether Do Kwon deliberately manipulated prices and whether domestic cryptocurrency exchanges conducted proper listing review procedures.
