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The Other Side Of The Do Kwon Story: Fat Man Terra Visits Laura Shin

It’s time to listen to the other side. Fat Man Terra used to be a cog in the Terra machine, but nowadays he’s the protocol’s biggest critic. He’s also a researcher, and his investigation lead him to believe that Terra was a scam from the very beginning. Of course, Laura Shin’s Do Kwon interview rubbed Fat Man Terra the wrong way. So, exercising his right to reply, he went to the same platform and told his side of the story.

If what Fat Man Terra says is true, the Terra/ Luna story is a horror film. 

A court will probably decide if he’s right or wrong, though. Let’s explore his allegations, taking into account that this is just the investigator’s interpretation of the facts. He might know more about the Terra/ Luna case than everyone on Earth, though.

This is the introduction to the episode titled “Fat Man Terra Speaks: Do Kwon Is a ‘Sociopath’ and a ‘Charismatic Manipulator”:

“Fat Man Terra, the anonymous Twitter account dedicated to bringing Do Kwon to justice, reacts to my recent interview with Do Kwon and says what he thinks it revealed about his personality.”

This is the video:

Fat Man Terra Presents The Case

  • According to the pseudonymous investigator, the Terra creators were “unfairly enriching themselves” and failed to disclose critical information to investors. On purpose.
  • Regarding his interview with Shin, Fat Man Terra thinks Do Kwon was “dancing around questions” and didn’t answer directly several of them. 
  • He thinks Do Kwon was “intentionally lying” about Terra’s breakup with Chai. Both when it happened and during the interview. At best, the situation was “heavily mishandled.”
  • Fat Man Terra claims that on-chain data shows that TerraForm Labs cashed out billions of dollars. They cashed out throughout Terra’s whole existence.
  • He also thinks there’s proof that the organization has “hundreds of millions stashed away.”
  •  According to the pseudonymous investigator, at the time Terra claimed that the protocol was attacked, but could not find “proof of fraud.”

The investigator also thinks that Do Kwon is “not able to stick to one story.” That’s a characteristic that fraudsters often exhibit. And he claims there’s a reason that regulators all over the world are looking at Terra specifically. Some things don’t add up, and this case is far from over. 

LUNA price chart on Eightcap | Source: LUNA/USD on TradingView.com
Opinions About Do Kwon’s Character

Respectfully, Fat Man Terra goes for the throat. He’s been studying Do Kwon and his diagnosis is that the man is:

  • A “sociopath with little regard for people’s feelings.”
  • “Avoiding law enforcement” and “definitely on the run.”
  • An idiot. Apparently, Do Kwon held all of the company’s bitcoin reserves in a single wallet. 
  • A liar. He knew that his involvement in the failed algorithmic stablecoin Basis Cash was relevant and should have disclosed it. 
  • A thief. Do Kwon was pretending to believe in Terra over everything and promoting it as such to retail. In reality, he was “simultaneously pulling out” hundreds of millions. 

According to Fat Man Terra, it all comes down to that. “If you really believe in UST, why did you cash out so much,” he asks Do Kwon. Also, why did he made up statistics and inflated the network’s numbers? 

The investigator will “start to believe he’s sorry” when Do Kwon starts making affected Terra investors whole from his own pocket. 

Fat Man Terra Is Still Optimistic

The parasites will always be there, surrounding the crypto space. According to Fat Man Terra, if the industry wants to survive we have to start “calling out scammers” and “pushing for justice.” He believes the industry will develop “failsafe mechanisms” to filter out bad actors and, in general, he’s “optimistic about the future of the space.” Make no mistake, though. Despite the optimism, the investigator claims that “Terra was a scam at every level.”

According to Laura Shin, Do Kwon will be back to answer the allegations in the future.

Featured Image: Laura Shin screenshot from the interview | Charts by TradingView

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Meet The UST Restitution Group: Tracking Do Kwon, Looking For Payback

The UST Restitution Group is on Do Kwon’s tail. A few governments and this civilian group are all out looking for the Terra creator, who insists that he’s not on the run. The Terra/ Luna collapse was one for the books, and that book is still open. We will write many more headlines about Do Kwon, and probably a few about the UST Restitution Group also. What’s done is done, some might say, but others will not rest until the case involves a court. 

In the FT article menacingly titled “Retail investors become vigilantes in hunt for crypto’s most wanted man,” we get to meet the UST Restitution Group. It’s “an association of nearly 4,400 crypto investors trying to track down Kwon, who is wanted in South Korea on charges of financial fraud.” That’s not Do Kwon’s only legal problem, the UST Restitution Group “launched class action lawsuits against Kwon in Singapore and the US, while Interpol has issued a red notice for him. South Korea is expected to revoke his passport on Wednesday.”

UST Restitution Group: Anons Looking For Do Kwon

According to the UST Restitution Group’s website, “Members have suggested that Kwon could be in Dubai, Russia, Azerbaijan, the Seychelles or Mauritius, among other locations.” A pseudonymous user went further and wrote, “Dubai is friendly to crypto, very international (he would not stand out), and has limited extradition treaties in place. It would seem like the best fit for the 3-5 hour timezone shift apparent in the data.”

Reviewing their impressive methods, another pseudonymous user reveals, “I obviously wouldn’t delve into specifics because publishing our methods would render them ineffective. I think we’re doing more than anyone else, though.” This particular UST Restitution Group member “introduced himself as a 31-year-old Ivy League-educated American,” and goes by the name of Antithesis. “His days are numbered. We have people who are very, very close to Do Kwon,” the person said. 

These are very high-level people. They’ve been scorned and they want answers. What will they do to Do Kwon when they find him, though? Another UST Restitution Group member that goes by the name of HKTrader “said he spent a month organising a Singapore class action lawsuit against Kwon and discovered his whereabouts in the country by hiring a private detective.”

Do Kwon is not in Singapore” anymore, though.

UST price chart on Kraken | Source: UST/USD on TradingView.com
How Would They Do It?

The elephant in the room is this: people are not sure how Do Kwon’s trial is going to go. The FT article quotes Seoul crypto expert Choi Hwa-in, “I wonder how effective the legal action against him could be, given the lack of legal ground to punish crypto players. This would just strain the crypto market further, dragging down their value and hurting investors more as a result.”

They also quote an official statement from Terraform Labs themselves, “Recent developments reaffirm that Terraform Labs and its stakeholders remain subjected to a highly politicised and erratic legal environment in South Korea. The facts are on our side, and we look forward to the truth coming to light in the coming months.” Is it possible that Do Kwon and company have it all under control? If so, why is he hidd… oh yeah, because the UST Restitution Group people are literally looking for him.

In a recent interview with journalist Laura Shin, the Terra creator refused to reveal his current location. Apparently, when people knew where Do Kwon was, there was trouble. In the interview, the Terra creator admitted failure and said the cause was the protocol’s “weakness to respond to the cruelty of the markets.” Do Kwon admits to technical and theoretical mistakes, but denies Terra was a scam. 

For her part, Laura Shin went to bat for Do Kwon on this issue. “I’m sorry, people, but this is totally not cool. What do they plan to do when they find him? WTF? People are crazy — Do was right when he said on my show that he can’t reveal his whereabouts. Seriously, don’t do this,” the journalist tweeted.

Featured Image by Amy Z from Pixabay | Charts by TradingView

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Laura Shin Asks Terra’s Do Kwon The Tough Questions. What Did We Learn?

This is the Do Kwon interview everyone was waiting for. In the latest episode of Laura Shin’s Unchained Podcast, titled ‘It Was Never Really About Money or Fame or Success’, the Terra creator faces serious scrutiny. Do Kwon denounces media misinformation, denies several serious charges and gives a play-by-play explanation of the organization’s movements during the crash. And he sweats bullets. 

Laura Shin did her homework, and relentlessly puts forward the questions most Terra investors have. She does this in a non-threatening, extremely professional way. Do Kwon answers all of her questions. Some better than others, but the man does show his face and answers, which is a lot. Compassionately, Laura Shin also gives Do Kwon a second opportunity to say sorry to Terra’s affected investors and their families. He would’ve come across much worse if she hadn’t offered that second chance.

The episode’s intro says:

“Do Kwon, cofounder of Terraform Labs, discusses the charges against him, gives a message to Terra victims, answers allegations about potential fraud and non-transparent business practices.”

This is the video:

This Do Kwon interview is one for the books, everybody interested in the subject should watch it. Let’s bring out the bullet points and analyze this phenomenal piece of media.

Do Kwon On His Location And “On The Run” Status

  • He claims he doesn’t live in South Korea anymore and he’s not planning to return to face the alleged charges. He plans to appeal, though.
  • Do Kwon hasn’t seen a copy of the arrest warrant.
  • Apparently, cryptocurrencies are securities in South Korea. 
  • His team has been cooperating with South Korean authorities, fulfilling the court requests for different documents.
  • Do Kwon refuses to reveal his current location because of the difficulties it brings to his living situation. He denies he’s on the run. 
  • He denied frozen funds at the KuCoin and OKX exchanges belong to him, Terraform Labs, or the LFG foundation.

The most important news Do Kwon reveals, though, is that the organization is working with a chain analysis firm to produce a paper on their trading activities. “They should be publishing a report shortly, which I think is going to provide a lot more clarity,” he said. Do Kwon promised the report in “the next couple of weeks.”

LUNA price chart on Kraken | Source: LUNA/USD on TradingView.com
Terra Was a Failure But It Was Not A Scam

  • Do Kwon claims that his online persona was an alter ego and confesses that he got carried away with the “sh*tposting.”
  • Terra’s failure was caused by the protocol’s “weakness to respond to the cruelty of the markets.”
  • He admits to a lot of technical and theoretical mistakes but denies Terra was a scam. 
  • Do Kwon claims that the Anchor developers/ whistleblowers that came forward denouncing the protocol were only interns. Not a line of their code appears in the final product, and this is apparent in GitHub. 
  • Admits to the SDT premine of $1.4B. This was a second stablecoin that the Terra organization used to maintain the UST peg to the dollar. This stablecoin wasn’t even mentioned in the Terra whitepaper. According to Do Kwon, this was because they hadn’t conceived SDT when they wrote it. He claims Terra’s is an “academic whitepaper” and wasn’t supposed to cover all of the technologies’ use cases.
  • Do Kwon admits they were using market operations to maintain the UST peg to the dollar. In fact, he says this was always the idea. The burning and minting of LUNA was not the only procedure that was supposed to maintain the peg.

Do Kwon And The Other Admissions

  • Apparently, Terra and Chai haven’t been working together for a long time.
  • When asked about faking Chai’s numbers and interactions registered in the Terra blockchain, Do Kwon said that the numbers came from Chai. According to him, they were probably “distancing themselves” from the Terra situation but still using the blockchain.
  • When asked about his participation in Basis Cash, a failed algorithmic stablecoin, Do Kwon distanced himself from the situation. He was just founding the team, but had nothing to do with the actual project. “Basis Cash is not something that I designed or operated. It’s something that I encouraged,” Do Kwon said.
  • When asked about if he was planning to compensate Terra investors from his own pocket, Do Kwon said, “my personal funds are not significant enough to make a difference.”
  • He still believes the world needs to work towards a decentralized future and that we need censorship-resistant money. 

As for his future plans, Do Kwon says he plans to continue building “highly experimental” projects in the crypto space.

Featured Image: Do Kwon and Laura Shin, screenshot from the video interview | Charts by TradingView

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Bitcoin Price Could Fall To $8,000, Says Guggenheim CIO

Hearing more negative speculation would be unpleasant for the investors as the recent bloodbath’s catastrophic effects already slowed down crypto markets. But unfortunately, an expert predicted Bitcoin would go far below.

Scott Minerd, Chief officer at Guggenheim Partners, a global investment and advisory firm handling $325 billion under its management, speculated that the Bitcoin price could plummet to $8,000. He is the same man who once said in December that “Bitcoin price should be $400,000.”

Related Reading | XRP Has Broken Below Its Long-Standing Support, What’s Next?

The speculation refers to a nearly 70% drop from today’s price of BTC, fluctuating around $30,000.

BTC Could Fall With The Fed Being Restrictive

Speaking with the CNBC’s Andrew Ross Sorkin in an interview held on Monday at World Economic Forum, Switzerland, he said;

When you break below 30,000 [dollars] consistently, 8,000 [dollars] is the ultimate bottom, so I think we have a lot more room to the downside, especially with the Fed being restrictive.

Minerd highlighted the relationship between BTC price and Fed regulation and tightening policies.

Following its previous high of November 10, when BTC’s price marked $69,044, it decreased by around 58% of its value.

“Most of these currencies, they’re not currencies, they’re junk,” he added, saying that “I don’t think we’ve seen the dominant player in crypto yet.”

Comparing the current situation with the dotcom bubble of the early 2000s, he said;

“If we were sitting here in the internet bubble, we would be talking about how Yahoo and America Online were the great winners,” adding that “Everything else, we couldn’t tell you if Amazon or Pets.com was going to be the winner.”

In addition, he urges that digital currency is required to store value. As well as, become a medium of exchange and a unit of account. “I don’t think we have had the right prototype yet for crypto,” said Minerd.

Bitcoin price currently trades at over $29,000. | Source: BTC/USD price chart from TradingView.com
Investors Seem Hesitant To Buy Bitcoin Dips

The collapse of stablecoins, including TerraUSD (UST) and its fellow token Luna, has caused the market to suffer a severe blow.

Edward Moya, an analyst from the well-known forex and CFD trading platform of America, OANDA, has commented that Bitcoin prices are steadied even with the broad risk rally on Wall Street. He added;

It looks like most crypto traders are hesitant to buy the dip. Which most likely means that the bottom has not been made.

Moreover, Moya talked about the European Central Bank President Christine, who previously said digital currencies are “worth nothing.”

Related Reading | Solana (SOL) Could Register An Upswing, Thanks To This Pattern

“It is unlikely that any head of a central bank will endorse bitcoin or the other top coins. Especially as we are years away from a digital euro or dollar,” Moya stated. “It looks like bitcoin won’t really attract massive inflows. Until investors believe most major central banks are nearing the end of their tightening cycles.”

He speculated that giant coin prices will possibly remain choppy this summer. 

Featured image from Pixabay and chart from TradingView.com

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Investors Continue To Trade LUNA Despite Massive Crash

Investors continue to trade the LUNA token despite its enormous fall, seeing the coin lose 99% of its value from $62 on May 9 down to less than a cent by May 14. However, on May 20, LUNA remains the most trending cryptocurrency searched on CoinMarketCap.

With a market cap of $918 million, LUNA is trading at $0.00013 per coin. The coin has gained 1% in the last 24 hours and 75% last week.  

Related Reading | Bitcoin Selling Pressure Continues As Long-Term Holder SOPR Spikes Up

It’s worth noting that even though the price of this cryptocurrency had fallen dramatically over the past few days and South Korean officials were looking into penalizing its inventor for $78 million in tax avoidance, we see the coin trending higher than ever before.

The South Korean authorities are investigating why the value of Terra’s dollar-pegged stablecoin, UST lost its peg on May 9. The market for this coin quickly melted down within four days. As a result, the stablecoin lost $18 billion. This affected not only the stablecoin UST but also all networks built upon it, such as LUNA, whose price plummetted from $62 per coin down to a fraction of a penny.

LUNA is currently trading at $0.00013 with a 1% increase | Source: LUNA/USD price chart from Tradingview.com
Tax Authorities Fined LUNA Founder For Avoiding Taxes

In order to investigate, both South Korean regulatory bodies, the Financial Supervisory Service and the Financial Services Commission called the local cryptocurrency exchanges to submit the transactions data. 

The information requested from the local exchanges includes trade volumes for LUNA and UST as well the number of investors who have suffered losses because their investments declined during this time period.

On the data request, a local exchange operator, Yonhap, said;

It seems that they collected this information in order to minimize damage to investors in the future.

The Korean National Tax Service has found that Terra’s parent firms have avoided paying corporate and income taxes. The company moved LUNA from its software firm, Terraform Labs, to Singapore’s Luna Foundation Guard (LFG) to avoid paying taxes.

Do Kwon was fined $78 million by the tax department for acquiring and selling $3 billion in Bitcoin LFG. In addition, the Terra inventor could face further fines from the tax department.

The NTS requested that Do Kwon and Daniel Shin pay $100 million in taxes in December. However, the two men declined since their company, Terraform Labs, is domiciled in Singapore. The NTS argues that all of Terraform Lab’s operations are controlled from South Korea, but the two men maintain that their business is conducted primarily in Singapore.

Related Reading | Tether Cuts 17% Of Its Commercial Paper Holdings Over Q1 2022

In addition, only a few days before Terra collapsed, Do Kwon attempted to dissolve Terra’s Korean entities. There is speculation among onlookers about how long before the chain crumbled, Do Kwon had been prepared for Terra’s downfall.

The founder of Terra is being sued by 200,000 people in Korea who invested in either LUNA or UST.

Featured image from Flickr, and chart from Tradingview.com