Disclaimer: Information found on CryptoreNews is those of writers quoted. It does not represent the opinions of CryptoreNews on whether to sell, buy or hold any investments. You are advised to conduct your own research before making any investment decisions. Use provided information at your own risk.
CryptoreNews covers fintech, blockchain and Bitcoin bringing you the latest crypto news and analyses on the future of money.
A district court in South Korea has dismissed allegations of securities violations against Hyun-seong Shin, the former CEO and co-founder of Terraform Labs. The court ruled that LUNA (LUNA), the native token of the LUNA ecosystem, is not classified as a security under Korea’s Capital Markets Act.
The southern district court in Seoul rejected the prosecution’s appeal to seize Shin’s assets and to arrest him based on alleged violations of securities law. The prosecution contended that Luna’s fraudulent activities constituted breaches of the Capital Markets Act, in addition to property-related crimes (fraud), which could justify asset confiscation, according to a local news report.
A Google-translated version of the court’s remarks stated:
“It is difficult to view Luna Coin as a financial investment product governed by the Capital Markets Act.”
The court, while denying the prosecution’s request for the confiscation of the defendant’s assets, observed that it is challenging to determine that the property in question was “acquired through a crime or an asset derived from it.”
Related Posts
This recent ruling is particularly significant as it explicitly declares that Luna is not a security. Previous court decisions have employed more cautious phrasing, such as “there is room for dispute in terms of the law” and “it is uncertain whether the Capital Market Act can be applied.”
The attorney representing the former CEO indicated that the court dismissed the prosecution’s requests for an arrest warrant for his client and others involved in the case. He noted that the court’s ruling suggests that Luna cannot be easily classified as an investment product.
Related: Do Kwon lawyers received $7 million before Terra collapse: Report
The recent court decision frames the Terra-LUNA situation as a matter of fraud and breach of trust rather than a breach of the Capital Markets Act. Nevertheless, the prosecution continues to emphasize the securities aspect of the native token and has appealed to the Supreme Court regarding the lower district court’s ruling.
The ruling from the Korean district court contrasts with the position of the United States Securities and Exchange Commission, which has accused Terraform Labs and its founder, Do Kwon, of violating securities laws. However, Kwon’s legal representatives have refuted the SEC’s allegations of securities fraud.
Magazine: Why join a blockchain gaming guild? Fun, profit and create better games
