Terra’s new LUNA 2.0 token has lost 54% in value in the past two weeks, after it reached $11.33 per unit on May 30. In the meantime, the whistleblower Fatman accused Terra’s co-founder Do Kwon of cashing out a staggering $2.7 billion a few months before the UST de-pegging incident.
However, Kwon has been keeping track of Fatman’s allegations and he claims that these allegations are “categorically false.”
LUNA 2.0 Token Lost 54% In Value In The Past 2 Weeks
The LUNA 2.0 rebirth token has been massively lackluster in terms of market performance during the last two weeks. Nonetheless, as reports emerged last week, a myriad of decentralized finance (DeFi) protocols had rejoined the ecosystem.
Notably, Terra’s 2.0 chain has nearly $1.32 billion locked in the Stader decentralized finance application based on the defillama.com stats. The Terra Classic chain has about $10.54 million total value locked in decentralized finance currently too, with $3.11 million held on Terraswap and $2.47 million locked into Anchor.
In the last two weeks, after LUNA 2.0 tapped a high of $11.33 per unit, the new LUNA has lost around 54% in the past two weeks. It is currently down 86% from the all-time high of $18.87 per coin when the 2.0 blockchain was first unveiled.
At the time of publication, LUNA 2.0 has $135 million in global trade volume, which pales when compared to the volume Luna classic (LUNC) saw before the fallout. Top crypto exchanges in terms of trade volume for LUNA 2.0 include Huobi Global, Kucoin, Bitrue, Okx, and Gate.io.
LUNA 2.0’s top five trading pairs today consist of USDT, USD, USDC, EUR, and ETH, respectively.
Whistleblower Fatman Alleges Kwon Cashed Out $2.7B Before UST Collapse
Terra co-founder Do Kwon is still being accused of being involved in some shady acts. While LUNA’s market performance has not been quite hot, alongside various crypto assets suffering through the bear market, Do Kwon is still being accused of many illegal operations by the whistleblower Fatman.
Should we start using the term Kwonzi more often? I propose a definition.
Kwonzi: a financial scheme with borrowed elements from and a similar negative-sum nature to a Ponzi but not a Ponzi – cleverly obfuscated by sophisticated manipulation, legitimate technology, and jargon.
— FatMan (@FatManTerra) June 12, 2022
A few days ago, reports emerged that the U.S. Securities and Exchange Commission (SEC) was reportedly investigating the Terrausd (UST) collapse and the firm Terraform Labs (TFL). On June 11, Fatman accused Kwon of siphoning a staggering $2.7 billion from the Terra projects a few months before the UST implosion.
Fatman tweeted:
“Some of you thought $80m per month was bad. That’s nothing. Here’s how Do Kwon cashed out $2.7 billion (33 x $80 [million]) over the span of mere months thanks to Degenbox: the perfect mechanism to drain liquidity out of the LUNA [and] UST system and into hard money like USDT.”
Fatman said that the decentralized finance borrowing protocol Abracadabra’s Degenbox and tokens like SPELL and MIM were used to offer “deeper exit liquidity to the UST pair.” According to the whistleblower, Kwon managed to cash out $2.719 billion through the MIM/UST pool without moving the peg.
Fatman continued:
“UST is the future, he said. Decentralized money is sound money, he said. UST won’t de-peg, he told you. ‘Centralized stablecoins will rug you eventually.’ So why did he cash out $2.7b from UST into USDT and USDC?”
Do Kwon Refutes All Cash Out Accusations
Nonetheless, Do Kwon has refuted the claims he stole $2.7 billion before the UST crash. He said the same day Fatman accused him:
“This should be obvious, but the claim that I cashed out $2.7B from anything is categorically false.”
Notably, Kwon also has his Twitter account set to private mode, and just people Kwon tags in a tweet can reply. He insists that he does not care about money that much.
Kwon continued:
“Two contradictory claims seem to exist where: Do’s wallets are doxxed, and he still owns most of his Luna through the airdrop [or] Do dumped all his tokens to make billions. A lane should ideally be picked.”
The Terra co-founder added:
“To reiterate, for the last two years the only thing I’ve earned is a nominal cash salary from TFL, and deferred taking most of my founder’s tokens because I a) didn’t need it and b) didn’t want to cause unnecessary finger-pointing of ‘he has too much.’”
On Twitter, people have extensively discussed how Kwon seems more humble now when compared to calling people “poor” during LUNA’s peak fame. Many others have been discussing Kwon allegedly “bending over” Abracadabra founder Daniele Sesta and “SPELL bagholders.”
The allegations say that tokens like SPELL, MIM, and Abracadabra’s Degenbox were utilized in helping Kwon siphon UST into harder stablecoin assets. Sesta and Abracadabra have already had their share of controversy previously with the Wonderland TIME debacle.
[PEOPLE YOU MEET ON THE WAY UP, YOU MEET ON THE WAY DOWN]Do Kwon (Ponzi @stablekwon) no longer cares about money. Remember his favorate insult was "poor"; he didn't debate @Frances_Coppola because he "doesn't debate the poor" & had "no change for her".https://t.co/B7R8JWDWJT
— Nassim Nicholas Taleb (@nntaleb) June 12, 2022
Terra’s co-founder insisted on Twitter that none of what is being said about him cashing out any money is true. Kwon concluded on June 11 in his refutation against the allegations that he cashed out $2.7 billion:
“Hope that’s clear – I didn’t say much because I don’t want to seem like playing victim, but I lost most of what I had in the crash too. I’ve said this multiple times but I really don’t care about money much. Please say things that are proven and true – if you are spreading falsehood that just adds to the pain of everyone who has lost.”
In the meantime, Fatman continues to accuse Kwon of engaging in many dirty tricks and the whistleblower continues to criticize Kwon’s ostensible acts, together with his current commentary and excessive refutation of the accusations.
