The revival plan suggests renaming the old Terra blockchain as Terra Classic and having Luna Classic (LUNC) as its primary token. South Korean authorities are seeking to freeze the assets of the LFG because five investors alleged fraud and violation of financial regulations.
The developers behind the Terra project LUNA recently clarified that Terra 2.0 would not be a fork but a new blockchain. They stated on Twitter that the revival plan does not propose to fork the existing blockchain but to create a one.
The team defines a fork as a change to an existing blockchain leading to two blockchains with a shared history but different future paths. However, Terra 2.0 will not share the history of Terra, which will exclude it from being a forked blockchain.
They commented that the approval of Proposal 1623 would allow the creation of a new (Terra) blockchain from the genesis block 0.
The revival plan for Terra will receive approval by a vote on Proposal 1623, which suggests renaming the old Terra blockchain as Terra Classic. It will have Luna Classic (LUNC) as its primary token, whose launch is due in the coming days. In addition to that, the new blockchain, also called Terra, will use the original LUNA token.
Do Kwon, the creator of Terraform Labs, clarified that Terra would set aside the stablecoin TerraUSD (UST), which dropped below USD 1. The team also said that popular decentralized apps (dApps) built on Terra Classic would not migrate to the new Terra blockchain.
The current confusion arose because Do Kwon wrongly used the term fork in his draft of the Terra revival plan. However, the founder of the blockchain recently removed that word from the post.
South Korean Authorities Investigate Terraform Labs for Alleged Fraud
While writing this article, the Terra ecosystem approved Proposal 1623, calling for the genesis of a new blockchain. However, South Korean authorities are reportedly attempting to freeze the assets of the Luna Foundation Guard (LFG).
According to local media, the Seoul Southern District Public Prosecutor launched an investigation into Terraform Labs. They assigned the case to their Securities and Financial Crimes Joint Investigation Team, which South Korean justice minister Dong-hoon Han recently created.
The authorities announced the investigation after five investors with combined damages of 1.4 billion won (KRW) filed criminal complaints. They alleged that Do Kwon and Daniel Shin committed fraud and violated financial regulations, among other charges.
The law firm LKB & Partners said that the lack of information about the flaws and the unlimited expansion of LUNA led to defrauding investors. The above five Korean investors hired them to file charges against Terraform Labs for those reasons.
Terraform Labs is currently in Singapore but has registered to operate its business as Terraform Labs Korea in South Korea. Besides the current situation, the internal legal team of Terraform Labs resigned, faced with the collapse of UST and LUNA.
LUNA (LUNC) is trading at around USD 0.000136 and has accumulated a 24.1% loss over the last 24 hours. While its daily trading volume is above USD 630.63 million, its market capitalization is about USD 88.78 million. It occupies 67th place in the cryptocurrency ranking, according to CoinGecko.
By Alexander Salazar
