Original source: Odaily Planet Daily
Original author: Loopy
Recently, the exposure of a court document gave us a glimpse into the internal chat records of Terra’s tens of billions of dollars financial empire.
SEC court documents disclosed a Slack chat that took place in 2019 between Do Kwon, founder of Terraform Labs, and Daniel Shin, another co-founder and founder of payment application Chai.
The content shows that Do Kwon almost directly admitted that they had falsified the trading volume. In addition, more explosive "melons" are also hidden in it, including bombardment of peers and contempt for retail investors. The most shocking one is undoubtedly the self-revealed pre-mining of 1 billion stablecoins. Odaily Planet Daily takes you into the melon-eating moment and takes a quick look at what Do Kwon said.
Do Kwon: We can create transactions that “look real”
Among the court documents, nothing stands out more than Do Kwon's account of the forged transactions.
Do Kwon told Shin, "I can create fake transactions that look real... and that will incur fees." Shin asked what if "people find out it's fake," and Do Kwon replied, "If you don't tell me, I Don’t even say it.”
In 2019, Terra announced a partnership with Chai, which aims to simplify the payment system through blockchain and provide transaction fees to merchants at discounted prices. According to the official statement, this cooperation will help the Terra network handle "millions or even billions of transactions."
However, the SEC wrote in the filing that Chai does not use the Terra chain to process and settle payments. Instead, payments were made in traditional ways, and fake transactions were copied to the Terra chain to make it appear that Terra had made a large number of payment settlements.
Daniel Shin cast some doubt on the incident, asking, "Won't people find out it's fake?"
Do Kwon replied, "So I'll try my best to make it indistinguishable."
Daniel Shin agreed, "Okay, let's test it on a small scale. Let's see what happens."
Interestingly, in addition to the fake transactions, the chat between the two also included more interesting content. This includes both the Terra project itself and gossip about other actors in the industry.
"Crown Jewel"
During the chat, Do Kwon made a side comment about Terra that didn't seem positive (he didn't say it outright).
Regarding the staking rate, he commented, "Only those investors who believe that Terra is the crown jewel (Hashed, 1kx) and those who operate a staking business (Polychain) will pledge."
Loan flooding?
During the chat, Daniel Shin listed Terra’s large investors in both its Seed 1 and Seed 2 funding rounds.
Judging from the data, large investors invested a total of approximately US$15 million in the two rounds. Although small investors have not been disclosed, public information shows that the number of small investors is not large, only about single digits. Therefore, it is speculated that Terra’s seed round financing should be slightly more than 15 million, but far from a level that significantly exceeds it.
The PR release disclosed by Terra shows that the project’s seed round financing is as high as US$32 million. At present, this data may be greatly watered down.
"Upbit lists all the junk coins, but not us"
During the discussion between the two, Do Kwon mentioned that a project called Thunder is being launched on Upbit. Daniel didn't know about this project and directly asked "What is Thunder?"
Do Kwon gave him a short answer - Berkeley University professor Elaine Shi's shitcoin.
He also continued to complain: "What's wrong with Upbit?... All the garbage coins in the world have been listed by Upbit, but not us."
"I pre-mined 1 billion stablecoins"
While Terra’s most famous stablecoin is the U.S. dollar stablecoin known as UST, it is much more than that. There are a huge variety of stablecoins growing on the Terra ecosystem, including U.S. dollar stablecoins, Korean won stablecoins, Mongolian Tugrik stablecoins, and more.
The most special one is Terra SDT. SDT is a stable currency anchored to the IMF Special Drawing Rights (SDR). The value of 1 SDT is stable at 1 SDR.
What’s even crazier is that Do Kwon said: “I also pre-mined 1 billion SDT for ourselves.”
Do Kwon admitted in the chat that the value of Terra is somewhat exaggerated:
As you said, we have a hard time justifying a $3 billion valuation right now, regardless of how many percent of that story is accepted.
end
Chai is a company that has a very close relationship with Terra. The company was founded in mid-2019 and shared offices and employees with Terraform until 2020, when the two companies separated.
At present, Do Kwon’s legal team has refuted this Slack chat record as evidence in court. His legal team claimed:
The SEC unreasonably distorted evidence in an attempt to harm Mr. Do Kwon in a procedural motion that had no bearing on the SEC's merits."
This relied on a misrepresentation of irrelevant evidence to support its false claim that it was unable to obtain evidence from Do Kwon.
Do Kwon, meanwhile, is being detained in Montenegro while his lawyers push for a U.S. federal court to reject the SEC's request to extradite him to the United States.
At present, this case is still in the long judicial process, and we still don’t know the final outcome.
Daniel once launched a soul torture to Do Kwon: "Is this a Ponzi scheme?"
Kwon replied: "Of course not, but some people (referring to the investing public) are just stupid, and I keep telling you, they are really stupid."
(The above content is excerpted and reprinted with the authorization of partner MarsBit, original text link | Source: Odaily Planet Daily)
Statement: The article only represents the author's personal views and opinions, and does not represent the objective views and positions of the blockchain. All contents and opinions are for reference only and do not constitute investment advice. Investors should make their own decisions and transactions, and the author and Blockchain Client will not be held responsible for any direct or indirect losses caused by investors' transactions.
This article Do Kwon’s chat records are exposed: there is constant black material, and it goes far beyond fake transactions. It first appeared on Blockchain.