While South Korean authorities are looking for Do Kown, Terraform Labs believes the Luna/UST case has become increasingly politicized.

Singapore-based company Terraform Labs said South Korean prosecutors had exceeded the limits of their authority with respect to the arrest warrant against the company’s co-founder, Do Kwon.

Terraform Labs also said the Luna token is not a security, arguing that public pressure could have caused promoters to broaden the definition of securities.

A Terraform Labs spokesperson told the Wall Street Journal that South Korean prosecutors were “exaggerating their authority.” According to the spokesperson:

“We believe that this case has become highly politicized and that the actions of Korean prosecutors demonstrate injustice and a failure to uphold the basic rights guaranteed by Korean law.”

In early September, a South Korean court issued an arrest warrant for Kwon and five other individuals, alleging that they had violated capital market rules.

A short time later, the Terraform Labs co-founder said he was not on the run, but stated that he had no reason to reveal his location as the information was reserved for a few people.

Know more: South Korean Court Issues Arrest Warrant for Do Kwon; MOON plummets

A Terraform Labs spokesperson also declined to disclose Kwon’s location, stating “ongoing physical security risks to him and his family” as a reason to hide his whereabouts.

Meanwhile, Singapore authorities previously stated that Kwon was not in the city-state. On September 26, South Korean prosecutors noted that Interpol had issued a red alert for Kwon, which further claims he is not hiding from authorities.

Amid efforts to locate the Terraform Labs co-founder, there were allegations that Kwon transferred 3,313 BTC from Luna Foundation Guard (LFG) wallets to KuCoin and OKX. He refuted the allegations, but exchanges confirmed the freezing of the assets in question.

Know more: Prosecutors Issue Order to Freeze Bitcoin Linked to Kwon

Luna is not a security

Terraform Labs also argued that Luna is not legally classified as a security, meaning the token was not under South Korea’s capital market law. According to the company, this would also not mean that neither Kwon nor the company carried out any illegal operation. The spokesperson said:

“We believe, like most in the industry, that Luna Classic is not, and never has been, a security, despite any changes in interpretation that Korean financial authorities may have adopted recently.”

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