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Why Terra 2.0 And Awaited LUNA Airdrop Might Never Happen

Altcoins

thecryptobasic.com 24 May 2022 09:49, UTC
  
Reading time: ~3 m

Terra 2.0 And Luna Airdrop Might Be In Ambiguity.


The Terra community has been in limbo for days waiting for Do Kwon and Terraform Labs to formulate a plan to help investors mitigate losses after Luna’s price crash. When Do Kwon proposed the creation of a new Terra chain, dubbed Terra 2.0, things seemed to get better.

However, a recent expose has the community worried. Back in South Korea, Do Kwon and Terra Foundation Guard (TFG) are facing a legal backlash, even as they try to assure the community that Terra 2.0 is coming.

Terra’s Legal Troubles

Apparently, the South Korean police, precisely the Seoul Metropolitan Police, have requested all crypto exchanges in South Korea to freeze all assets owned and TFG. This is after allegations of embezzlement were leveled against the foundation and its controller, Do Kwon.

According to Naver, the Seoul Metropolitan Police in South Korea has asked each exchange to freeze the funds of the Luna Foundation Guard, and there are clues suspected of being related to embezzlement of public funds. https://t.co/0s2a9aXCme

— Wu Blockchain (@WuBlockchain) May 24, 2022

The charges revolve around the Bitcoin reserves that TFG held to protect UST’s and Luna’s prices from crashing to extreme levels. While Do Kwon and TFG claim that the reserves were used during the crash but weren’t as effective as expected, there are claims from other quarters that this didn’t happen and that the funds were embezzled.

Terra 2.0 To face Hurdles

Following Do Kwon’s proposal 1623, the community voted to build a new Terra chain and airdrop the new Luna tokens to current holders. However, creating an entirely new blockchain network takes resources, workforce, and time. This is where things get thick since the legal issues facing Do Kwon, and the TFG in South Korea have led to the freezing of much-needed funds. This could complicate matters as Terra 2.0 could run into financial hurdles that could delay its creation and launch. In turn, the Luna airdrop might turn out to be a mirage that will never materialize.

It’s not yet clear what Do Kwon and the Terra team are doing to mitigate these issues to prevent Terra 2.0 from running into roadblocks. However, the discussions surrounding the building of Terra 2.0 are still in infancy, and the community is still looking up to Do Kwon and his team for solutions.

On the other hand, Terra Founder Do Kwon Faces Three South Korean Investigations.

The South Korean Congress has demanded Terra’s Do Kwon to be brought before it for question over the Luna and UST price crash that saw 200,000 South Koreans lose their investments in the crypto.

Kwon And Terra Owe $78 To The Government

Also, Do Kwon and Terra are faced with another tax issue. According to the authorities, Kwon and Terra have tax arrears amounting to $78 million. Do Kwon has denied these allegations.

Revived Crime Unit To Investigate Terra

Luna’s and UST crash led the South Korean government to revive a disbanded crime investigation that was last active two years ago. The unit, consisting of 40 officials, will investigate to establish what led to the collapse of Terra and whether anyone is responsible for it. Millions of investors have lost money due to the collapse of Luna and UST.

Under such circumstances, it might not be possible for the Terra team to continue, especially when all of your assets are frozen by exchanges at the request of the Seoul Metropolitan Police as air drops and building a new blockchain from scratch needs funds.


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