Terraform Labs CEO Denies Withdrawing $2.7B from Ecosystem Before its Collapse

Do Kwon, CEO of Terraform Labs, has denied allegations that he withdrew billions of dollars from the Terra ecosystem prior to its collapse and said the claims are “categorically false.”

Analyst FatMan has previously said Degenbox’s $UST-$MIM strategy on the Abracadabra platform allowed Kwon to withdraw more than 2.7 billion UST from Terra in just a few months.

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He has said:

“Some of you thought $80m per month was bad. That’s nothing. Here’s how Do Kwon cashed out $2.7 billion (33 x $80m!) over the span of mere months thanks to Degenbox: the perfect mechanism to drain liquidity out of the LUNA & UST system and into hard money like USDT.”

FatMan has explained that such strategy offered high returns and was promoted by “Terra influencers.” According to him, this made it possible to create the necessary liquidity for withdrawals. Thanks to the high demand, it was possible to exchange UST for MIM without breaking the UST link.

The analyst has noted that MIM was eventually exchanged for USDT and USDC and then sent to centralized exchange addresses, including Binance, KuCoin and Huobi.