According to the Seoul Prosecutors’ Office, Shin is accused of violating the Capital Markets Act, dereliction of duty and embezzlement in connection with his involvement with Terra-Luna. They accuse him of defrauding investors by promoting Terra’s stablecoin as a payment system, knowing that such services are prohibited.

Terra-Luna, a cryptocurrency project with stablecoin and $40 billion cryptocurrency company Terraform Labs, collapsed in May last year. Shin founded the company in 2018 with Stanford University computer science graduate Kwon Do-Hayon. After the project collapsed, Kwon fled to Europe and is currently in Montenegro after being sentenced to four months in prison for attempting to travel through the country on a fake passport.

The U.S. and South Korea have filed extradition requests for Kwon, citing similar charges against Shin. Kwon denies all charges against him.

Shin was publicly indicted on April 25, with Dan Sung-han, director of the financial crime unit of the Seoul South District Prosecutor’s Office, saying that Shin’s role in the alleged fraud was greater than Kwon’s. However, prosecutors failed to convince a local court to approve an arrest warrant for Shin.

On the same day of the indictment, Shin’s lawyers denied all allegations in an emailed statement, saying that financial authorities did not have a formed opinion about cryptocurrency as a payment system when Terra was launched.