Daniel Shin's Pre-Trial Hearing Kicks Off: Terra Collapse Case Heats Up in South Korea

Terraform Labs co-founder Daniel Shin is now facing trial over the $60B Terra collapse disaster. South Korea’s Seoul Southern District Court began preliminary hearings today, with Shin potentially joining eight other former Terra executives in the dock.

Here’s where this gets interesting: Shin didn’t even show up to court. His legal team is pushing back hard, claiming he bailed from Terra and Luna two years before the ecosystem imploded in May 2022. So by their logic, he’s got nothing to do with the $60B bloodbath that torched investor wallets.

The Charges Are Heavy

Prosecutors are hitting Shin with fraud, bribery, Capital Markets Act violations, breach of duty, and embezzlement. The accusation? He allegedly hyped UST (the algorithmic stablecoin) as a legit payment system while knowing full well that crypto payment services were illegal in Korea. Even sketchier—he supposedly masked regular fiat transfers as Terra transactions through his payment company Chai Corp., snagging roughly $91 million from VCs.

According to Seoul’s financial crime team director, Shin played a bigger role in the fraud than Do Kwon himself. That’s saying something.

The Do Kwon Parallel

Meanwhile, co-founder Do Kwon already caught a 4-month sentence in Montenegro for fake passport charges. He got nabbed in March. Kwon’s still the face of the Terra disaster, but authorities now seem convinced Shin was the financial architect behind the whole scheme.

Shin’s defense: “I left the project years ago, and I came back voluntarily to cooperate.” We’ll see if that holds up in court. The hearings just started, so expect more details to spill in the coming weeks.