SEOUL, April 25 (Yonhap) -- Prosecutors on Tuesday indicted Daniel Shin, co-founder of Terraform Labs, in connection with the massive crash of the cryptocurrency firm's TerraUSD and Luna coins in May of last year that it removed nearly 50 trillion won (US$37.5 billion) in market value.
The Seoul Southern District Court indicted Shin, 38, without physical detention on multiple charges, including fraud, dereliction of duty and embezzlement, prosecutors said.
Along with Do Kwon, the other Terraform co-founder currently detained in Montenegro for passport forgery, Shin was behind the structuring of the TerraUSD and Luna cryptocurrencies, the implosion of which led to the wiping out of nearly 50 trillion won in market value. Prosecutors are seeking Kwon's extradition.
TerraUSD was designed as a stablecoin, which was pegged to stable assets, such as the US dollar, but fell as low as 10 cents in May, breaking its 1-to-1 peg to the US dollar.
Prosecutors suspect that Shin knew the pricing system was algorithmically impossible, but misled investors around the world into investing in the coins by keeping their prices high through trade manipulation and fraudulent advertising campaigns.
Shin and his accomplices had already pocketed 462.9 billion won in illegal profits when the two currencies collapsed last year, prosecutors concluded.
Shin is also tasked with raising 122.1 billion won of investment from venture capital firms at home and abroad with a fake project promoting the coins as currency to pay for goods.
In this file photo, Daniel Shin (center), co-founder of Terraform Labs, attends a court hearing in Seoul on March 30, 2023. (Yonhap)
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