In a recent shocking turn of events, Montenegrin Prime Minister Milojko Spajic has been exposed as one of the early investors in Terraform Labs. This revelation comes from court documents released by the U.S. Securities and Exchange Commission (SEC), which detail Spajic’s investment of $75,000 in April 2018. This investment granted him 750,000 Luna tokens, valued at an astonishing $90 million at their peak.
Spajic was reportedly the 16th investor in Terraform Labs during their initial fundraising phase. He entered into a contract with the company on the first day of fundraising, securing Luna tokens at a bargain price of $0.10 each. Despite the high risks associated with such early-stage investments, Spajic’s investment was made at a time when Terraform Labs was looking to raise capital for their cryptocurrency project.
Unfortunately, Terraform Labs’ cryptocurrency project ultimately failed in 2022, resulting in losses exceeding $40 billion for investors worldwide. The collapse of the Luna token in spring 2022 saw its value plummet from $119 to near zero, causing significant financial losses for those involved. Experts suggest that had Spajic held onto his tokens through the market’s peak, his losses could have amounted to a staggering $90 million.
One of the most troubling aspects of this scandal is Spajic’s failure to report his ownership of Luna tokens to the Agency for the Prevention of Corruption. In his 2020 and 2021 financial reports, he only declared owning Bitcoin worth €150,000, omitting any mention of his substantial investment in cryptocurrencies. Furthermore, it is unclear whether Spajic sought to recover his lost investment or took legal action against Terraform Labs and its founder, Do Kwon, for fraud.
The Legal Consequences
In the aftermath of the Terraform Labs scandal, the SEC has held the company and Kwon accountable for defrauding investors. A settlement was reached that required Terraform Labs to pay $4.37 billion in fines and interest, while Kwon was ordered to contribute $200 million to an investor compensation fund. Kwon, who is currently detained in Montenegro, faces extradition to either the United States or South Korea for trial.
The downfall of Montenegrin Prime Minister Milojko Spajic in the Terraform Labs scandal serves as a cautionary tale about the risks of early-stage investments and the importance of transparency in financial dealings. It highlights the devastating impact that fraudulent schemes can have on unsuspecting investors and the repercussions that perpetrators ultimately face.