Ever since Terra crashed, the eyes of the crypto community and the authorities are set on Do Kwon. The Stanford dropout entrepreneur promised a lot when he introduced the Terra Blockchain.
But since the crash, Do Kwon has faced a lot of allegations ranging from the community saying the LUNA was nothing more than a Ponzi scheme to authorities saying that he cashed out a lot of money from LUNA and UST that might have aggravated the conditions that led to the crash.
There are claims that the Chief Operating Officer of the now ill-famed Terra and TerraUSD ecosystem had been withdrawing $80 million per month from the chain for nearly three years.
Unofficial reports state that Do Kwon foresaw the Terra Crash
The withdrawal rumors surfaced after some unofficial reports said that Do Kwon had an inkling about Terra’s downfall a long time prior. His withdrawals were in preparation to offset the personal losses in the event of the crash.
One particular tweet comes from Twitter user @FatManTerra, who goes by the Twitter handle Fatman. He has claimed that Do Kwon drained liquidity out of the LUNA and UST ecosystem and into hard money to make gains, leaving the community high and dry.
🧵 Some of you thought $80m per month was bad. That’s nothing. Here’s how Do Kwon cashed out $2.7 billion (33 x $80m!) over the span of mere months thanks to Degenbox: the perfect mechanism to drain liquidity out of the LUNA & UST system and into hard money like USDT. (1/13)
— FatMan (@FatManTerra) June 11, 2022
The user then created a lengthy thread consisting of multiple Tweets to lend credence to the rumors further. These threads contain long reports that contain TFL outflows that show a lot of liquidity being removed from the Terra ecosystem.
These tweets have individually received hundreds of likes, retweets, and comments from crypto users who believe the allegations and those who are asking for more proof.
The “whistleblower” has credited Twitter user @fozzydiablo for all the data and research provided.
Fozzydiablo is one of the many crypto watchers who had always been wary about Terra’s algorithmic Stablecoin, questioning the ecosystem’s sustainability since the beginning of January 2022. Fatman claims that he was the first to foresee the Terra crash, but the crypto market was basking in the bull phase too much to notice.
If $UST is so stable why dump 2.8 BILLION of it? pic.twitter.com/oKvtRCZKBP
— Fudzy (@fozzydiablo) January 28, 2022
The allegations are that Do Kwon took the help of Degenbox’s Abracadabra.money and a staking loop to withdraw hard cash.
Don’t believe in the Rumours: says, Do Kwon.
The latest gust of rumors has put Do Kwon into defense mode. He has posted a public denial on the microblogging website and has stated the words are categorically false.
1/ This should be obvious, but the claim that I cashed out $2.7B from anything is categorically false
— Do Kwon 🌕 (@stablekwon) June 12, 2022
He has asserted that spreading misinformation and contradictory allegations about his holdings will cause hurt to those who are still holding on to their LUNC and LUNA tokens.
The announcement of the Terra Revival camp divided the crypto camp into two teams. One was bullish about the new upgrade and eagerly awaited LUNA 2.0 airdrop, and the other decided to burn the LUNC that they hold to reduce the LUNA supply.
Over 983 million LUNA classic tokens have been burned so far.
🚨🚨 total burned $LUNC stands at 983,223,548 million 🚨🚨 17m until the 1st billion 🔥🔥 #LUNC #luncburn #lunaclassic
— LUNC Burn (@LunaBurn_13) June 14, 2022
Coming back to Do Kwon’s response, the infamous founder says that he lost most of his LUNA holdings himself, and all he has made from TerraForm Labs in the last three years is cash salary.
His words come after another one of the community’s claims that Do Kwon holds most of the LUNA through an airdrop.
I warned Do Kwon that the interest rates were unrealistically high – Anchor Developer
In light of these rumors, another name has come forward called Mr. B. He is a developer from Anchor Protocol. He allegedly had warned Kron that the LUNA interest rates were unrealistic.
Mr.B claims that the platform was designed to supply an interest rate of 3.6%. However, Do Kwon decided to add modifications to it to support a 20% interest rate just before the release. The developer allegedly requested Do Kwon to lower the interest rate but was refused.
Do Kwon to Attend Parliamentary Hearings
In light of the crash, South Korea’s parliament has invited Do Kwon and the cryptocurrency exchanges to explain the situation.
The crash has fueled the calls to regulate the crypto market as investors continue to take the brunt of the loss while the developers and founders have largely been safe.
LUNA Price Prediction
Luna has been trading at increasing lows for the past few days. CoinMarketCap reports that today’s LUNA price is $2.42 and is down by 5.56% in the last 24 hours. This price is massively lower than LUNA’s disappointing launch at $17.
Most experts are bearish about LUNA in the future, saying that it might have the same fate as the old LUNA. The official Twitter account of Terra has recently announced Proposal 446 to establish an emergency allocation distribution method for $LUNA to eligible teams.
In response, most Twitter users have requested the developer post the Burn address once again to remove the existing LUNC classic from circulation.
It seems that whatever support Terra had during its revival plan is not disappearing.
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