Terra’s ecosystem was relaunched two weeks ago with the LUNA 2.0 airdrop, but the token’s value has plummeted to new lows, with its price decreasing over 70%. The token is now trading at $3.41, according to Coingecko data.
Because of rumors regarding Do Kwon’s participation in the creation of the new Terra network, trust in the new ecosystem is low.
The rumors surfaced after FatMan, a self-proclaimed Terra insider, claimed that Kwon and Terraform Labs lied about the new network being community-owned. “TFL owns 42M LUNA, worth over $200m,” he alleged.
He further alleged that Kwon was involved in the relaunch and utilized his LUNA holdings to vote in favor of the hard fork, despite community demands that he burn the tokens.
Although none of these allegations have been proven, they have created enough doubt to induce a large sell-off of the token. Do Kwon’s choice to make his Twitter account private may have contributed to the ecosystem’s anxieties.
FatMan wasn’t the first to make accusations against Do Kwon. He recently claimed that Kwon’s climb to the top was based on nepotism.
He claimed that Kwon rose to prominence when his first firm, Annify, earned a $550,000 Infobank grant. However, he questioned how he received the grant when the company had no product at the time. According to him, Kwon received the funds as a result of his ties to Infobank.
Meanwhile, law enforcement officials in South Korea are apparently investigating a Terraform Labs employee for suspected misappropriation of the company’s Bitcoin. Aside from that, officials want to determine if Do Kwon was aware of the crash.
DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.
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