- South Korea held its first hearing on cases against Daniel Shin.
- Shin co-founded Terraform Labs with Do Kwon and is charged with criminal offenses.
- The defendant’s lawyers rejected all charges and Shin did not attend the hearing.
South Korea held its first preliminary hearing on Monday for Daniel Shin, the co-founder of Terraform Labs, and seven former employees of Terra, as reported by the Seoul Southern District Court.
Shin was indicted on April 25 on various charges, including fraud, related to the collapsed Terra-Luna cryptocurrency project. However, Shin’s lawyers immediately rejected all the charges on the same day as the indictment.
According to Seoul prosecutors, Shin is charged with violating the Capital Markets Act, breaching his duty, and embezzlement in connection with Terra-Luna. Prosecutors allege that he defrauded investors by promoting the Terra stablecoin as a payment system, despite knowing that such services were prohibited.
When asked for comment, Shin responded via email, stating that he did not attend the preliminary hearing and had no comment at this time.
Terraform Labs’ Terra-Luna project, which was valued at $40 billion, collapsed in May of last year. Shin co-founded the company in 2018 with Kwon Do-heyong, a Stanford University computer science graduate. Kwon, who fled to Europe after the project’s failure, is currently detained in Montenegro for attempting to travel using a forged passport and has been sentenced to four months in jail.
Both the United States and South Korea have requested Kwon’s extradition, citing similar charges faced by Shin. Kwon, however, denies all allegations against him.
Although Shin was publicly indicted on April 25, the Seoul Southern District Prosecutors’ Office failed to obtain an arrest warrant for him. Shin’s lawyers released a statement on the same day, rejecting all accusations and arguing that financial authorities did not have a clear stance on cryptocurrencies as a payment system at the time of Terra’s launch.
