SEOUL (BLOOMBERG) - The fallout from the Terra (LUNA & UST) collapse continues. Terra employees are now under the intense scrutiny of South Korean regulators. Recent reports indicate that South Korean prosecutors have banned current and former employees of Terraform Labs from leaving the country, suggesting prosecutors are stepping up their investigation into the circumstances surrounding the dramatic implosion of the UST stablecoin and its sister token, LUNA (now LUNC).

This departure ban impacts key developers and other personnel at Terraform Labs. Terraform Labs employees are reportedly unable to leave South Korea due to the country’s prosecutors imposing a departure ban on those perceived to have vital information about the collapse. The Financial and Financial Securities Crime Joint Investigation Team of the Seoul Southern District Prosecutor’s Office is leading the investigation and have reportedly summoned all Former and current employees of Terraform Labs. South Korean authorities have reportedly summoned all employees at Terraform Labs as part of a full-scale investigation of the collapse of UST and LUNC, the local assets that shook the cryptocurrency market.

Terraform Labs employees have been summoned by South Korean prosecutors in a bid to establish the exact cause of the collapse of Terra assets. The investigation aims to determine if any illegal activities contributed to the downfall. The Seoul Southern District sanctioned Terraform Labs employees, preventing them from leaving the country as the investigation deepens. Meanwhile, despite the controversies, a brand new chain, Terra 2.0, made its debut. As Terraform continues to navigate these legal challenges, the focus remains on understanding the events that led to the initial collapse.