luna burning
  • The Terra Luna Classic community has accused Karak Network co-founder Raouf Ben-Har of stealing 200 million USTC, valued at approximately $8 million, sparking renewed concerns about fund security.
  • Karak Network’s CSO, Victor Cheng, has denied the allegations, asserting that no user funds were misappropriated.

In a significant development, the Terra Luna Classic community has accused Karak Network’s co-founder, Raouf Ben-Har, of stealing 200 million USTC, a cryptocurrency asset worth millions. The allegations have reignited concerns within the community about the safety and integrity of their funds.

A Closer Look at the Allegations

The controversy was brought back into the spotlight by Terra Luna Classic developer RedlineDrifter. He claims that the Karak Network, which is backed by Coinbase and Pantera Capital, has not returned the missing USTC, valued at approximately $8 million. RedlineDrifter specifically pointed to Raouf Ben-Har, who was previously associated with Risk Harbor, now rebranded as Andalusia Labs. According to the community, the Risk Harbor team used an administrative function to withdraw 200 million UST, now known as USTC.

The community has made significant efforts to manage the circulating supply of Terra Luna Classic (LUNC) and USTC. Recently, they removed 93 million LUNC and 87 million USTC from the Terra Shuttle Bridge (BSC) contract, in addition to burning 800 million USTC. Despite these efforts, the unresolved issue of the missing 200 million USTC remains a significant concern.

Karak Network’s Response

Victor Cheng, the Chief Strategy Officer (CSO) at Karak Network, responded to the allegations by assuring the community that no user funds were ever touched. He explained that the UST in question was sold by the Terra Foundation for a fraction of its value, which was then carried forward to Karak. Cheng emphasized that the foundation’s actions were legitimate and that the funds were not misappropriated.

Impact on USTC and LUNC Prices

The ongoing controversy has had a noticeable impact on the prices of USTC and LUNC. As of the latest trading data, USTC is priced at $0.01808, reflecting a 1% decline over the past 24 hours. The trading volume for USTC has also decreased by 32%, indicating a drop in trader interest.

In contrast, LUNC has seen a slight increase in price, trading at $0.00008329, up by 1% in the last 24 hours. However, its trading volume has dropped by 23%, suggesting a similar decline in market activity.

The Terra Luna Classic community is hopeful for a significant recovery in the prices of both USTC and LUNC, particularly with the upcoming Binance LUNC burn and the implementation of Tax2Gas in July. These measures are expected to reduce the circulating supply further and potentially drive up the value of the remaining tokens.

As the community continues to seek clarity and resolution regarding the missing 200 million USTC, the spotlight remains on Karak Network and its actions. Whether the allegations will lead to any formal investigations or restitution remains to be seen, but the incident underscores the importance of transparency and accountability in the rapidly evolving world of cryptocurrency.