July 20, 2024

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Laura Shin Asks Terra’s Do Kwon The Though Questions. What Did We Learn?

4 min read
Laura Shin Asks Terra’s Do Kwon The Though Questions. What Did We Learn?

This is the Do Kwon interview everyone was waiting for. In the latest episode of Laura Shin’s Unchained Podcast, titled ‘It Was Never Really About Money or Fame or Success’, the Terra creator faces serious scrutiny. Do Kwon denounces media misinformation, denies several serious charges and gives a play-by-play explanation of the organization’s movements during the crash. And he sweats bullets. 

Laura Shin did her homework, and relentlessly puts forward the questions most Terra investors have. She does this in a non-threatening, extremely professional way. Do Kwon answers all of her questions. Some better than others, but the man does show his face and answers, which is a lot. Compassionately, Laura Shin also gives Do Kwon a second opportunity to say sorry to Terra’s affected investors and their families. He would’ve come across much worse if she hadn’t offered that second chance.

The episode’s intro says:

“Do Kwon, cofounder of Terraform Labs, discusses the charges against him, gives a message to Terra victims, answers allegations about potential fraud and non-transparent business practices.”

This is the video:

This Do Kwon interview is one for the books, everybody interested in the subject should watch it. Let’s bring out the bullet points and analyze this phenomenal piece of media.

Do Kwon On His Location And “On The Run” Status

  • He claims he doesn’t live in South Korea anymore and he’s not planning to return to face the alleged charges. He plans to appeal, though.
  • Do Kwon hasn’t seen a copy of the arrest warrant.
  • Apparently, cryptocurrencies are securities in South Korea. 
  • His team has been cooperating with South Korean authorities, fulfilling the court requests for different documents.
  • Do Kwon refuses to reveal his current location because of the difficulties it brings to his living situation. He denies he’s on the run. 
  • He denied frozen funds at the KuCoin and OKX exchanges belong to him, Terraform Labs, or the LFG foundation.

The most important news Do Kwon reveals, though, is that the organization is working with a chain analysis firm to produce a paper on their trading activities. “They should be publishing a report shortly, which I think is going to provide a lot more clarity,” he said. Do Kwon promised the report in “the next couple of weeks.”

LUNA price chart on Kraken | Source: LUNA/USD on TradingView.com

Terra Was a Failure But It Was Not A Scam

  • Do Kwon claims that his online persona was an alter ego and confesses that he got carried away with the “sh*tposting.”
  • Terra’s failure was caused by the protocol’s “weakness to respond to the cruelty of the markets.”
  • He admits to a lot of technical and theoretical mistakes but denies Terra was a scam. 
  • Do Kwon claims that the Anchor developers/ whistleblowers that came forward denouncing the protocol were only interns. Not a line of their code appears in the final product, and this is apparent in GitHub. 
  • Admits to the SDT premine of $1.4B. This was a second stablecoin that the Terra organization used to maintain the UST peg to the dollar. This stablecoin wasn’t even mentioned in the Terra whitepaper. According to Do Kwon, this was because they hadn’t conceived SDT when they wrote it. He claims Terra’s is an “academic whitepaper” and wasn’t supposed to cover all of the technologies’ use cases.
  • Do Kwon admits they were using market operations to maintain the UST peg to the dollar. In fact, he says this was always the idea. The burning and minting of LUNA was not the only procedure that was supposed to maintain the peg.

Do Kwon And The Other Admissions

  • Apparently, Terra and Chai haven’t been working together for a long time.
  • When asked about faking Chai’s numbers and interactions registered in the Terra blockchain, Do Kwon said that the numbers came from Chai. According to him, they were probably “distancing themselves” from the Terra situation but still using the blockchain.
  • When asked about his participation in Basis Cash, a failed algorithmic stablecoin, Do Kwon distanced himself from the situation. He was just founding the team, but had nothing to do with the actual project. “Basis Cash is not something that I designed or operated. It’s something that I encouraged,” Do Kwon said.
  • When asked about if he was planning to compensate Terra investors from his own pocket, Do Kwon said, “my personal funds are not significant enough to make a difference.”
  • He still believes the world needs to work towards a decentralized future and that we need censorship-resistant money. 

As for his future plans, Do Kwon says he plans to continue building “highly experimental” projects in the crypto space.

Featured Image: Do Kwon and Laura Shin, screenshot from the video interview | Charts by TradingView