Do Kwon May End the Terra Saga Behind Bars
Do Kwon is About to be so gone
Do Kwon has been busy submitting a new fork proposal and recovery plan to the Terra community, but his troubles are only beginning. His tweets after the crash, such as "I love chaos," have caused many negative reactions from the public. Investors victimized by Kwon's suspected fraud are launching a class action lawsuit against him.
This lawsuit may be the least of his worries, though. There was a report last week that a disgruntled investor went to Kwon's personal residence in an effort to find him and likely do harm. Kwon's wife answered the door to the man, told him that Kwon wasn't home, and afterwards requested special police protection for her husband.
The ironic part is, that South Korean officials are actually investigating Kwon for fraud involving the anchor protocol. Specifically, the authorities are investigating whether the protocol's promised 20% interest on the UST stablecoin fits the definition of a Ponzi scheme. If found guilty, Kwon will likely be in the South Korea corrections system for a long period of time.
Kwon is now being compared to famous frauds such as Bernie Madoff and faketoshi Craig Wright. His fall from grace is especially notable when you consider Kwon saw LUNA rivaling Bitcoin as a store of value, and it's nearly at zero. Top exchanges are now removing LUNA and UST, which should be the final nails in the casket.
Unfortunately, many individuals had a lot of skin in LUNA and UST. The sheer madness of this crash can be best shown by hedge fund manager Mike Novogratz's LUNA tattoo. Yikes...
Once a failure, always a failure
Do Kwon's solution to the problem is a fork of Terra called Terra Classic, which features no stablecoins; to no surprise of anyone. After the initial crash, CoinDesk reported that this was Kwon's second failed stablecoin project. The first attempt, Basis Cash, was developed by members of Terraform labs in addition to Kwon, and failed miserably after the stablecoin lost its peg similarly.
Given the amount of other options in the industry, there is little reason for any person to use Kwon's new fork. The likelihood of another crash is high.
The future of Do Kwon and Terra
The Terra blockchain ecosystem and Do Kwon are related, but separate. If South Korean authorities can prove that Kwon committed fraud, then he will likely be carted off to jail. However, if this occurs, the many dev teams in the ecosystem could save the blockchain (if it's even worth it).
In situations like these, despite police protection, Kwon remains in substantial danger. Even though he's wronged thousands of investors around the world, his loved ones and him don't deserve harm. There is also new information from potential whistleblowers that may result in further court cases for Mr. Kwon. Based on the evidence, a likely solution is Kwon serving some prison time while paying damages to his victims.