Douglas Henkin, defense attorney for Terra founder Do Kwon, said at a hearing in Manhattan federal court on Thursday that anonymous whistleblowers, including one from market-making giant Jump Trading Group, assisted U.S. federal regulators in filing a fraud case against Kwon. Douglas Henkin said that the "Jump Trading whistleblower" who provided evidence to the US SEC admitted during his testimony that he had no direct, first-hand knowledge of the transactions in 2021. A spokesman for Jump Trading declined to comment. The U.S. SEC accused Do Kwon of misleading investors in a previous lawsuit regarding the stability of its stablecoin TerraUSD.
Mark Califano, another attorney for Do Kwon, said at the hearing that the SEC relied on a whistleblower in another major part of the case, involving South Korean payments app Chai. The SEC accused Do Kwon of deceiving investors by publicly claiming that Chai used the Terra blockchain to settle payment transactions, when in fact it used traditional payment technology. Califano said the whistleblower secretly recorded a conversation with a Chai engineer in which they discussed how the app worked. Califano noted that the whistleblower was "extremely biased" and said he had been "caught lying multiple times." (Wall Street Journal)
It was previously reported that a Montenegrin court approved the extradition of Terra founder Do Kwon to South Korea or the United States. Montenegro's Minister of Justice will make the decision on extradition.
Additionally, the judge allowed Jump Crypto to keep Terra-related documents filed confidentially in the U.S. SEC lawsuit.