Additionally, the regulatory body has alleged that Do Kwon and the firm have “engaged in a fraudulent scheme to mislead investors about Terraform blockchain and its crypto asset securities. Terraform and Kwon repeatedly – and falsely – told the investing public that a popular Korean electronic mobile payment application called “Chai” employed the Terraform blockchain”. The claim set forth was that the blockchain was used for commercial transactions.
However, in reality, the Chai payments never used the blockchain to process transactions. Do Kwon and Terraform Labs “deceptively replicated Chai” transactions in order to make it seem like the blockchain was deployed. In addition, the commission has alleged that the defendants misled investors about the stability of UST, the stablecoin pegged to LUNA.
