Do Kwon openly disputed the $2.7 billion charges, calling them "categorically false"

Do Kwon has disputed new charges that he used Degenbox to withdraw $2.7 billion from the Terra environment.


Do Kwon denies news allegations about withdrawing money
Do Kwon

Do Kwon was reportedly accused of taking $80 million each month from the Terra ecosystem in the months preceding up to the meltdown – new charges suggest this happened more than 33 times, and Abracadabra Money took $2.7 billion out of the system using Degenbox.


After reactivating his Twitter account, Do Kwon openly disputed the charges, calling them "categorically false."


According to the allegations, Do Kwon withdrew the money using Abracadabra.money and a staking loop that allows for extraordinary amounts of leveraging, as stated by FatManTerra,


“You can stake collateral to buy UST, put it into Anchor, then use your aUST to borrow more UST, put it into Anchor again… You get the drill. It’s Anchor on steroids.”

Other derivative tokens, such as stETH, use the staking loop as well. These advanced yield tactics provide incredibly volatile investments with ever-increasing liquidation risks, but they promise outrageously large profits.


FatManTerra said that Do Kwon, engaged in such a tactic, risking the future of Terra for his own personal benefit.


Because there isn't enough liquidity to absorb the selling pressure, FatManTerra wondered how Do Kown could have sold the $80 million tranches of tokens he obtained without crashing the price of either LUNA or UST.


FatManTerra, on the other hand, stated that Degenbox's popularity had created enough "near-immovable liquidity" for Do Kwon to convert billions of UST into MIM.