A South Korean court has again dismissed an arrest warrant for Daniel Shin, co-founder of Terraform Labs, who is being investigated for fraud.Shin is the pre-collapse cryptocurrency of over $100 million He is accused of illegally profiting from the sale of luna.
Seoul Court Leaves Terraform Co-Founder Alone, Citing Low Risk of Flight
The Southern District Court of Seoul has denied a request by the Prosecutor’s Office for the pretrial detention of Shin Hyun-sung, co-founder of the failed blockchain company Terraform Labs, also known as Daniel Shin. He is believed to have played a key role in the collapse of the company’s cryptocurrency, luna, and stablecoin terrausd.
On Thursday, Shin’s arrest warrant was dismissed for the second time, with the court saying that he was unlikely to be a flight risk or destroy evidence, Yonhap News reported. The crypto entrepreneur is being investigated for illegal gains he made before the coin crashed last year.
Prosecutors first requested an arrest warrant for Singh in November, but the court rejected the first request. They again requested an arrest warrant last week after the arrest of Kwon Do-Hyung, another founder of Terraform.
Kwon was detained in Montenegro while trying to board a plane to Dubai. South Korean authorities are seeking his extradition, but it is likely to take some time. He will first face trial in the Balkan country on charges of traveling on a forged Costa Rican passport, according to a Montenegrin lawyer and the country’s justice minister.
In South Korea, Daniel Shin faces multiple charges of fraud and violating laws governing capital markets, financial transactions, and information. He allegedly obtained 140 billion won ($108 million) by storing pre-issue lunas and selling tokens at a higher price point, and failing to inform investors about the risk of collapse of the two cryptocurrencies.
Shin is also alleged to have used customer information and funds from Chai Corp. a fintech company he represents, to promote luna. He denies all of these charges and maintains that he has no connection to Terraform Labs since leaving Terraform Labs in March 2020, when he founded Chai Corporation.
According to a report by South Korean state broadcaster KBS, the Seoul court acknowledged that the charges were largely verified, but noted that Kwon’s arrest reduced the risk of evidence destruction. It also stressed the need to allow Shin to exercise his right to defense.
Montenegrin Interior Minister Filip Azic revealed this week that investigators found three of Kwon’s laptops and five cell phones, which contained a lot of “very interesting” information. Press Conference.