Investigations are trying to figure out whether the FTX Former CEO was responsible behind the downfall of the Terra project.
Terra (Luna) was a popular crypto asset in the top 10 crypto assets of the crypto world. TerraUSD (UST) and Luna were two native tokens on the Terra blockchain and both of these two coins were connected to each other to maintain the value of each UST equal to $1. But in May of this year, both of the tokens collapsed badly.
On 7 December, NewYork Times published a report on behalf of the information collected from two unnamed persons and confirmed that U.S. prosecutors in Manhattan are investigating against Sam Bankman-Fried (SBF), founder & former CEO of the FTX Crypto Exchange, whether he was responsible behind the collapse of the Terra (Luna) crypto project or not.
The report also noted that there are chances that SBF manipulated the price of Luna coin or tried to short the UST stablecoin with the help of FTX exchange or its sister companies for personal benefits.
This investigation is in the early phase and here such enforcement actions have been taken on behalf of the doubt & possibilities because the Terra project was in the top 10 crypto assets and FTX exchange was in the top lists of crypto exchanges that collapsed badly.
Downfall of the Terra project
Under the high volatility situation in May of this year, the Terra project collapsed badly. Do Kwon, developer of the Terra blockchain team Terraform Labs, decided to launch a new Luna coin but still he failed to grab a high-level ranking with the new coin.
He renamed the old Luna coin to Luna classic (Lunc) & TerraUSD to TerraClassicUSD (USTC). The current price of USTC is $0.0244 which is 97.55% down from its actual pegged value of $1.
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