Do Kwon denies accusations of withdrawing $2.7 billion from the Terra ecosystem before its collapse

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The head of Terraform Labs, Do Kwon, denied the information that he allegedly withdrew billions of dollars from the Terra ecosystem before its collapse. He called such claims "categorically false."

FatMan analyst previously stated that Degenbox's $UST-$MIM strategy on the Abracadabra platform allowed Kwon to withdraw more than 2.7 billion UST from Terra in a few months.

“Some of you thought $80 million a month waspoorly. This is bullshit. This is how Do Kwon cashed out $2.7 billion (33 x $80 million!) in a few months thanks to Degenbox: the perfect mechanism to drain liquidity from the LUNA and UST system into hard money like USDT,” he wrote.

FatMan explained that the said strategyoffered high returns and was advertised by "Terra influencers". According to him, this made it possible to create the liquidity necessary for the withdrawal of funds - thanks to high demand, it was possible to exchange UST for MIM without breaking the binding of the first.

The analyst noted that MIM was eventually exchanged for USDT and USDC, and then sent to addresses of centralized exchanges, including Binance, KuCoin and Huobi.&nbsp;

FatMan urged Terraform Labs to explain the purpose of thesetransactions, disclose the sources of funds to the Luna Foundation Guard reserve, and publish data on transactions that the company has made to stabilize the price of UST.

Terra's Death Spiral: How and Why LUNA and UST Failed

In response, Do Kwon stated that his onlyincome for the last two years - "nominal cash salary" at Terraform Labs. According to him, he delayed receiving more of the "founder tokens" because he did not need them.

In May 2022, FatMan claimed that Kwon and venture capitalists manipulated the Mirror Protocol DeFi project and defrauded retail investors.

Let us remind you that Bloomberg learned that the US Securities and Exchange Commission has initiated an investigation into the algorithmic stablecoin UST.