As the stablecoin terra and cryptocurrency luna plummeted, Terraform Labs Pte co-founder Do Kwon allegedly transferred 9 billion won ($7 million) to a leading South Korean law firm, Kim & Chang, KBS News reported. According to South Korean prosecutors, this transaction suggests Kwon anticipated legal troubles and possibly had foreknowledge of the impending crash. This development could bolster the ongoing fraud case against Kwon.

Sources cited by KBS News claim that lawyers from Kim & Chang, South Korea’s largest law firm, recently traveled to Montenegro to meet with Kwon and Terraform’s ex-CFO, Han Chang-joon. Kwon faces fraud charges in both the US and South Korea, with both nations seeking his extradition from Montenegro, where he is currently imprisoned.

Kwon and Han were arrested in the former Yugoslav Republic on March 23, as they attempted to fly to Dubai using falsified travel documents. A judge will determine whether Kwon will be extradited to the US or South Korea. However, if convicted of using fake documents, he may first have to serve time in Montenegro.

Singaporean law enforcement is also probing the source of the funds transferred to Kim & Chang. KBS News reports that if Kwon liquidated illicit cryptocurrency assets to pay the lawyers, he could face embezzlement charges. Authorities in both Singapore and South Korea are trying to seize the funds.

This unfolding story serves as a reminder to entrepreneurs and investors in the cryptocurrency space to remain vigilant and exercise caution when engaging with digital assets. The legal ramifications of Kwon’s actions could have far-reaching effects on the industry and its regulatory landscape.