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Key takeaways:
- Daniel Shin, a co-founder of the defunct blockchain company Terraform Labs, was denied by the Seoul Southern District Court to be held in custody pending trial.
- Shin is also accused of using financial resources and client data from the finance company he oversaw, Chai Corp., to advance luna.
A plea for Shin Hyun-Seung, also known as Daniel Shin, a co-founder of the defunct blockchain company Terraform Labs, to be held in custody pending trial was denied by the Seoul Southern District Court. The company’s coins, Luna and the stablecoin TerraUSD, are thought to have been significantly impacted by him.
Kwon was detained on March 23 at the Montenegrin airport in Podgorica while attempting to fly overseas with forged documents. Taking advantage of the circumstance, the Seoul Southern District Prosecutors Office on March 27 asked for an arrest order for Shin, claiming that he had been involved in collecting illegal proceeds from the sales of Terra (LUNA) and TerraUSD (UST).
Despite the unproven claims and the unlikely possibility that Shin would flee the country or destroy evidence, the Seoul Southern District Court rejected the request, as reported by local news outlet Yonhap.
Shin is presently accused of several fraud offenses, particularly for allegedly concealing the dangers involved with purchasing Terraform Labs’ proprietary tokens. Shin is alleged to have stored pre-issued luna, made 140 billion won (nearly $108 million) by selling the tokens at a premium, and failed to warn buyers about the possibility of the two cryptocurrencies collapsing.
Shin is also accused of using financial resources and client data from the finance company he oversaw, Chai Corp., to advance luna. All of these accusations have been refuted by him, who maintains that he had no affiliation with Terraform Labs at the time of his founding Chai Corporation in March 2020, after leaving the business.
Following Kwon’s detention in Montenegro, officials from both South Korea and the United States have made an effort to extradite the businessman. Authorities in South Korea are asking for his return, which could take some time.
He will first go on trial in the Balkan country for traveling with a fake Costa Rican visa, according to his Montenegrin attorney and the justice minister of the state. Interior Minister of Montenegro Filip Adzic disclosed this week that Kwon’s three laptops and five mobile phones, which contained a wealth of “very interesting” information, were discovered by investigators.
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