In a shocking turn of events, it has been reported that the United States Securities and Exchange Commission (SEC) has discovered evidence that shows Terraform Labs CEO Do Kwon was withdrawing $80 million worth of LUNA (now called Luna Classic) and TerraUSD every month in the lead-up to the collapse of the Terra ecosystem in May. The event took place before the collapse of the Terra ecosystem.

Terraform Labs (TFL) was responsible for the loss of billions of dollars to investors one month ago, when the value of UST and its sibling token LUNA plummeted. The crypto market, which is worth a total of one trillion dollars, was thrown into utter turmoil as prices dropped across the board.

The catastrophic failure of the Terra network was brought to the attention of regulatory agencies all across the globe, and these agencies pledged to take action. The Securities and Exchange Commission in the United States is investigating whether or not Do Kwon was the mastermind behind a conspiracy to launder money.

According to a media outlet based in South Korea called JBTC, the government agency carried out remote video surveillance on a select group of Terra’s senior designers in order to investigate the problematic architectural structure of the network.

According to reports, the SEC obtained records confirming that Do Kwon had been paying out $80 million every month from corporate money and placing it into dozens of his cryptocurrency wallets. It is thought that these money were utilized to pay operational expenditures in the few months before to the breakdown of Terra. As a consequence of this, the regulator of securities judged this to be suspicious and sufficient evidence of money laundering.

Kwon did not get any formal compensation, as was made clear by a senior Terra employee who wished to stay nameless and intended to remain unknown.

The Securities and Exchange Commission (SEC) is now conducting an investigation to see if TFL and Kwon violated any federal laws protecting investors in the process of promoting their tokens to clients.

The announcement of the investigation’s expansion came not long after a court of appeals for the United States District Court determined that Kwon was had to reply to the subpoenas that were issued by the commission. The Securities and Exchange Commission (SEC) was already making assumptions that he had broken securities laws when he sold unregistered securities to consumers located within its jurisdiction.

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