Genuine mistake or fraud? That’s the question Terra’s Do Kwon needs to answer

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Do Kwon pleads his inno­cence on his twit­ter feed after lat­est reports con­demn him for cash­ing out $2.7 bil­lion. The Ter­raform Labs CEO is already fac­ing an inves­ti­ga­tion from the SEC and South Kore­an police. He is now at the heart of a lat­est cryp­to com­mu­ni­ty backlash.

“No Kwon do”

Do Kwon begins the thread with a state­ment that, “This should be obvi­ous but the aim that I cashed out $2.7B out of any­thing cat­e­gor­i­cal­ly false.” This was a reply to many alle­ga­tions sur­fac­ing on social media after a tweet from @FatManTerra. These alle­ga­tions sug­gest­ed that Do Kwon cashed out $80 mil­lion every month for near­ly three years.

So what’s the alleged plan sug­gest­ed by the Twit­ter han­dle @FatManTerra?

Here goes…

Fat­Man is an ana­lyst at the Ter­ra Research Forum who sparked a social media fury with his analy­sis of Do Kwon’s liq­ui­da­tion. He claimed that Do Kwon liq­ui­dat­ed $80 mil­lion worth of Ter­ra for 33 months using Degen­box. Now Fat­Man believes that this is the per­fect mech­a­nism to drain liq­uid­i­ty out of LUNA and UST into USDT.

He then pro­vid­ed liq­uid­i­ty exam­ples of LFG’s outflows.

Towards the end he pro­posed a “Call to action” for Do Kwon and his team:

– Clar­i­fy the pur­pose of these huge trades

– Pub­lish a PDF break­ing down the sources of LFG funds, since they were meant for UST holders

– Pub­lish trade logs and counter-par­ties for the ‘peg defence’

Do Kwon, how­ev­er, seem­ing­ly want­ed to steer clear of these rumors as they “just add to the pain of every­one who has lost.” But the cryp­to com­mu­ni­ty has been unfor­giv­ing since the Ter­ra crash which result­ed in loss­es amount­ing to $40 bil­lion. The mis­man­age­ment of the Do Kwon and his team has been wide­ly antag­o­nized by major cryp­to ana­lysts. But the news of “alleged­ly” cash­ing out before the crash has increased mass-scruti­ny towards him.

Pop­u­lar Youtu­ber Ben Arm­strong went bal­lis­tic towards Do Kwon in his tweets lat­er on. He said that “only a psy­chopath would invite this scruti­ny. There’s no escape for him at this point.”

Arm­strong added that despite cash­ing out $2B+ it is pos­si­ble “does not mean he knew about the col­lapse.” He believes that maybe Do Kwon was just tak­ing prof­its and was “blind­sided” by this. Final­ly, Arm­strong sug­gest­ed that maybe Do Kwon was “too ego­tis­ti­cal to believe Ter­ra had a huge vulnerability.”



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