The Korean court has declared that Terra Classic (LUNC), the renamed native token of the Terra network that crashed severely last year, is not a security.
Seoul Southern District Court again declared on February 16 that “it is difficult to see LUNC as a financial investment product regulated by The Capital Markets Act,” according to a report from the local news source Ilyo Shinmun today.
Even though the court had previously ruled on it on November 15, both judgments were only made public today by the news source.
In contrast to previous statements, such as “there is room for dispute in terms of the law” and “it is questionable whether the Capital Market Act can be applied,” the court has now definitely said that LUNC is not a security, according to the report.
Related Reading: Do Kwon’s Legal Team Disputing SEC Claim of Securities Fraud
Request to Seize Terraform Labs Co-founder Assets Rejected
According to the article, the court rejected the South Korean prosecutors’ attempt to seize the assets of Terraform Labs co-founder Shin Hyun-Seung.
According to reports, authorities asked to seize Shin’s assets worth more than $100 million in November because of his involvement in the demise of the Terra environment.
The court has denied the plea for confiscation since the assets must be given to Terra collapse victims rather than the national treasury.
However, on March 20 and April 14, respectively, prosecutors asked the Supreme Court of Korea for a ruling. However, the court still needs to make a decision.
The Terra collapse
When the TerraUSD (UST) stablecoin lost its 1:1 peg to the US dollar in May, the whole Terra ecosystem, which included LUNC (then known as LUNA) and UST, collapsed, wiping out over $40 billion in investor capital.
Along with Terra, Three Arrows Capital and Vauld were among the crypto companies forced into bankruptcy by the Terra collapse.
The conclusion of the Korean court that LUNC is not a security differs from that of the American regulators.
The business that created the doomed Terra coins, Terraform Labs, and its co-founder Do Kwon were sued by the U.S. Securities and Exchange Commission (SEC) earlier this year; at the time, the SEC referred to LUNC as crypto asset security.
Separately, according to court documents from Friday, Kwon’s attorneys have asked a US court to partially dismiss allegations brought against him by the SEC for lack of jurisdiction.
Kwon was recently detained in Montenegro for attempting to travel using forged documents, and just last week, the country officially charged him with using a fake passport.