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Former Terraform Labs Developer Admits Terra for Payments was ‘Impossible’

2 mins
Updated by Kyle Baird
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In Brief

  • Shin Hyun-sung, ex-CEO of Chai Corporation, a company that was linked to Tera, is on trial for the Terra ecosystem collapse.
  • Witness Mr. Lee reveals Terra project's legal hurdles and payment limitations, making staggering claims.
  • The defense have disputed Lee's claims, alleging lack of awareness from Shin and Kwon.
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A former Terraform Labs developer testified that Shin Hyun-sung, former CEO of Chai Corporation, and Do Kwon, former CEO of Terraform Labs, acknowledged that the Terra project wouldn’t function as publicly advertised.

A local report stated Shin and eight others were accused of breaching the Capital Market Act. A witness, identified as ‘Mr. Lee’ was a crucial witness who saw the inner workings of the firm before its downfall.

Terraform Labs Developer Makes Strong Claims

According to a recent local report, Lee revealed his awareness of the legal hurdles surrounding the Terra project. He reportedly admitted that it was impossible to use Terra for payments.

Lee worked as a developer at Terraform Labs. However, he disclosed that he obtained this information through Terraform Labs’ founder, Do Kwon.

Kwon and Shin deceived investors by pretending that all transactions from the Chai payment system were being recorded on the Terra blockchain when, in fact, they weren’t.

Read more: 11 best Altcoin Exchanges for Crypto Trading in January 2024

Additionally, Mr. Lee’s recent testimony cast doubt on the operational framework of the Terra project.

Terraform Labs hinged on using Terra, a coin pegged to traditional assets like the dollar, as a virtual currency akin to physical money through the ‘Chai Pay’ system.

The subsequent rise in the value of the blockchain’s native Luna (now LUNC), tied to Terra, was reported to generate profits.

At the time of publication, LUNC’s price stands at $0.00010910.

LUNC Price Chart 1 Month. Source: BeInCrypto
LUNC Price Chart 1 Month. Source: BeInCrypto

Terraform Labs Developer Challenged

In response, Shin’s defense counsel challenged Mr. Lee’s claims. He disputed the prosecution that Shin and Kwon were aware of the

“Impossibility of Terra payment utilization.”

They recalled a different version of events, suggesting Shin and Kwon had not acknowledged this limitation.

However, the prosecution alleges that Shin colluded with Kwon and others to falsely promote the ‘Terra project.’

Meanwhile, they specified this was over a timeline from July 2018 to May 2022, employing illicit methods to realize gains.

Top crypto projects in the US | May 2024

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Ciaran Lyons
Ciaran is a cryptocurrency journalist based in Sydney, Australia. He particularly enjoys writing about CBDC developments and the practical implementations of cryptocurrency in real-world scenarios. He has also appeared across major television networks in Australia including Channel Ten, Channel Nine and SBS TV. Prior to his foray into cryptocurrency, Ciaran worked as a presenter on national radio station Triple J.
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