KEY POINTS

  • Terraform Labs already bogged by collapse of Terra's UST and LUNA
  • Authorities did not reveal the amount of Bitcoin involved in the embezzlement
  • LUNA was trading down 14.99% at $2.94

As Terraform Labs (TFL) tries to wiggle out of the phenomenal fall of its token by creating a new Terra blockchain and LUNA 2.0, it is being haunted by further controversy. A report from South Korea claims that a TFL employee is now under investigation for allegedly stealing not LUNA but Bitcoin (BTC) from the company's coffers.

Terraform Labs, including its CEO Do Kwon, and all of its employees are being investigated by the South Korean government following the crash of Terra's algorithmic stablecoin UST and native token LUNA. While the probe is still ongoing, the Seoul Metropolitan Police Agency has accused one of Terraform Labs employees with embezzlement of Bitcoin.

The employee was allegedly found stealing Bitcoin, the corporate fund of Terra and LUNA, in May 2021, a local news site claimed. The allegation, which apparently came from an "intelligence source," was relayed to the authorities last month.

Terra
Terra UST Terra - Twitter

"It was intelligence about an employee’s personal embezzlement," the South Korean Police reportedly said. Because of this turn of events, authorities requested a crypto exchange platform to freeze the funds involved in the alleged embezzlement.

So far, it appears that the TFL employee acted on their own in regards to the alleged crime. The South Korean police did not reveal the amount of Bitcoin stolen or if this issue is connected to TFL's CEO Kwon.

Last month, the Seoul Metropolitan Police Agency requested major crypto platforms to restrict Luna Foundation Guard (LFG) from taking any action. This was due to recently discovered clues seemingly pointing at the possible embezzlement of funds linked to the organization.

However, the request is not a demand and not enforceable by law, which means cryptocurrency exchange platforms may or may not heed it. Investigation into the collapse of LUNA and UST is still ongoing in South Korea.

LUNA 2. 0, the native token of the new Terra blockchain launched last month, is having a hard time getting its price up. LUNA was trading down 14.99% at $2.94 with a 24-hour volume of $719,545,623 as of 2:04 a.m. ET on Thursday, as per CoinMarketCap's data.

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