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In a startling development that has sent shockwaves through both the political and crypto sectors, a court document has brought to light Montenegrin Prime Minister Milojko Spajić’s early investment in Terraform Labs. This revelation comes on the heels of Terraform Labs’ recent settlement with the US Securities and Exchange Commission (SEC), pertaining to a $40 billion fraud accusation against the company. Prime Minister Spajić, who took office in October 2023, is now at the center of this emerging controversy involving the notorious crypto entrepreneur Do Kwon.
Crypto Ties: Montenegrin PM Invested In Terra Luna
According to a report by the Montenegrin media outlet Vijesti, US court documents disclose that Spajić, in his capacity as a private investor, was one of the initial backers of Terraform Labs. In April 2018, he reportedly invested $75,000 to acquire 750,000 Terra (LUNA) tokens, ranking him 16th among the early investors. This was during the initial fundraising phase for the crypto project, which notoriously failed after four years.
A financial expert cited by Vijesti explained that Spajić purchased the LUNA tokens at a notably low price of 10 cents per token, a common practice in early-stage investing due to the high risk involved. The total fundraising during this period amounted to approximately $13.75 million over two days, contributed by 14 individuals and 10 companies.
The LUNA token, which reached a high of $119 in early 2022, plummeted to near zero shortly after, following the collapse of the crypto project. If Spajić did not sell any of his holdings before the crash, his potential losses could amount to nearly $90 million, reflecting the dramatic rise and fall of the token’s value.
The political ramifications of these revelations are significant, especially given the timing of Do Kwon’s legal troubles. Kwon, who is currently in Montenegro, is facing extradition proceedings to either the United States or South Korea, where he is charged with orchestrating a massive fraud.
The complexities of Spajić’s involvement extend beyond financial losses. He has previously stated that it was the company he worked for, and not him personally, that was defrauded by Terraform Labs. However, the disclosure of his direct investment challenges this narrative and raises questions about his financial disclosures and ethical conduct while in office.
So far, Spajić has refrained from publicly acknowledging his personal financial losses in the Terraform debacle. His responses to media inquiries have been evasive, focusing instead on the losses sustained by his company. The Prime Minister’s office and the Government Public Relations Service have yet to respond to questions about the nature of his investments and his current holdings in Luna tokens.
Another layer of controversy involves Spajić’s compliance with regulatory requirements. According to Vijesti, he has not disclosed his ownership of LUNA tokens in his financial declarations to the Agency for the Prevention of Corruption. His earlier financial disclosures indicated ownership of other cryptocurrencies, such as Bitcoin and Ethereum, but failed to mention LUNA specifically.
This omission raises significant concerns about transparency and potential conflicts of interest, particularly given the timing of his investments and the subsequent regulatory investigations into Terraform Labs. The lack of clarity in his declarations and the recent revelations from the US court documents paint a complex picture of Spajić’s financial and political entanglements with the crypto world.
At press time, Terra Luna Classic (LUNC) traded at $0.000090870.
Featured image from Euronews/ Inc Magazine, chart from TradingView.com
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