Terra co-founder Do Kwon faces $57-million lawsuit in Singapore
Do Kwon, the co-founder of Terraform Labs who may be facing legal actions in South Korea and the United States, is the target of a lawsuit in Singapore along with the Luna Foundation Guard (LFG) and Terra founding member Nicholas Platias.
In a lawsuit filed in Singapore’s high court on Sept. 23, 359 individuals allege Kwon, Platias, the LFG and Terra made fraudulent claims, including that Terra’s stablecoin, TerraUSD (UST) — now TerraUSD Classic (USTC) — was not “stable by design” and unable to maintain its U.S. dollar peg.
The claimants are seeking compensation for roughly $57 million worth of “loss and damage” combined based on the value of UST tokens they purchased and held or sold amid the market downturn in May. They also request an order to pay for “aggravated damages.”
According to the individuals filing the lawsuit, the four parties tied to Terra “knew or ought to have known that the Claimants wished to buy and hold cryptocurrency stablecoins that were not subject to the volatility of the wider market and earn a decent passive return.” The court document specifically alleges that Kwon had been aware of “the structural weakness of algorithmic stablecoins” based in part on his role in the fall of Basis Cash.
“The Defendants made the said representations fraudulently either well knowing that they were false and untrue, or recklessly not caring whether they were true or false,” says the lawsuit.
Related: 4,400 disgruntled investors are hunting for Terra’s Do Kwon
Kwon has been the target of numerous legal actions and threats since the collapse of the Terra blockchain ecosystem in May. South Korean authorities issued an arrest warrant for the Terra co-founder in September, which was subsequently dismissed, and Interpol
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