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Do Kwon Speaks On Why Terraform Labs Was Shut Down In Korea Days before the Historic Crash

The embattled founder of Terraform Labs, Do Kwon, has reacted to rumors about the decision to shut down his company in Korea days before the crash.

A lot has been said about Kwon, his crypto project, and the failure of the two digital assets (LUNA and UST) built on top of Terra blockchain.

It can be recalled that the Korean Tax Authority alleged that Kwon’s company is owing nearly $80 million in taxes. He was also accused of a calculated dissolution of his firm in Korea days before the massive crash.

Read Also: Do Kwon Amends Terra 2.0 Proposal When Voting Still in Progress. Aggrieved Members Right All Along?

The Shut Down Is Purely Coincidental

According to a report, Kwon dissolved his company’s Busan headquarters on the 4th of May and the Seoul branch office on the 6th of May, while the crash of Terra (LUNA) and TerraUSD (UST) became critical on the 12th of May.

In this regard, a supposed Terra community member challenged Kwon to respond to the allegation.

Reacting to the allegation as requested, Terraform Labs founder said the timing is purely coincidental, stating that he has made it known in several interviews and podcasts that he wants to relocate the company to Singapore.

Do Kwon tweeted, “I’ve been in Singapore since last December – this is a personal decision and has long been planned. I’ve been open about being located in Singapore across multiple interviews and podcasts. Shutting down a company just takes some time, and timing is purely coincidental.”

Clarifying further, he said, “Terraform Labs HQ has always been incorporated in Singapore and is still active and in good standing. We just no longer have a Korean subsidiary.”

Read Also: Terra Founder Do Kwon Shares Plan to Rescue UST Stablecoin Peg Following Historic Crash

Do Kwon Refutes Reports about Owing Nearly $80 Million in Taxes

In the same thread of tweets, Do Kwon also refuted reports that Terraform Labs owes about $80 million in taxes to the South Korean government.

According to Kwon, the company has no outstanding tax to pay in Korea.

Do Kwon wrote, “We have no outstanding tax liabilities in Korea. The NTS did conduct a tax audit across all the major crypto cos with a presence in Korea and applied Korean tax code to foreign mother companies, and every company ended up paying as a result – we paid in full. Not unique to TFL.”


Since the problem with the Terra ecosystem began, Do Kwon has been attracting massive negative attention. It was even reported that he’s being harassed at home, which brought about requesting police protection.

Over the past couple of days, Terra validators have been working to get around the issues with the blockchain. Attempts to proffer lasting solutions have even divided the community. A set of Terra community members want massive token burns, while Do Kwon and his team of developers suggest hard-forking to create a new blockchain.

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Tobi Loba
Tobi Loba
Tobi Loba is a passionate writer with a vast interest in the stock market. She joined the crypto ecosystem about three years ago and has written lots of ebooks and articles in relation to cryptocurrency and blockchain projects. Tobi Loba earned her degree at the University of Ibadan.

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