A week following Terraform Labs’ settlement with the United States Securities and Exchange Commission (SEC), fresh revelations from an April court filing have sparked a new controversy surrounding the defunct crypto venture. According to reports from Montenegrin media outlet Vijesti, Prime Minister Milojko Spajic, who assumed office in October 2023, invested $75,000 in Singapore-based Terraform Labs in April 2018 to acquire 750,000 Terra (LUNA) tokens.
Spajic, Montenegrin PM, invested in Terraform Labs. Source: SEC
The report indicates that Spajic was among the initial investors in Terraform Labs, just days before its official registration in Singapore on April 23, 2018. This information was unveiled in a court document submitted by the SEC. Prior to the release of these documents, the Montenegrin prime minister had denied making a personal investment in the failed crypto project, attributing the investment to Das Capital SG, a Singaporean firm he was associated with from 2017 to 2020. However, the SEC court records place him on the list of investors, confirming his involvement as one of the early backers of the company with a contract dated April 17, 2018.
Investors in Terraform Labs. Source: SEC
Terraform Labs, the entity behind the ill-fated LUNA and TerraUSD (UST) crypto tokens, achieved a market cap of $2 billion before its collapse in May 2022, resulting in the loss of nearly $40 billion from the crypto market. The downfall of Terra not only impacted the crypto ecosystem financially but also led to the downfall of numerous crypto hedge funds that had provided collateral to the company.
In April 2024, a jury found Terraform Labs and co-founder Do Kwon guilty of defrauding investors in their civil case with the SEC. Kwon, who had been evading authorities for months, was apprehended by international law enforcement agencies in March 2023. The emergence of new documents confirming a direct investment contract between Spajic and Terraform Labs could potentially create complications for the prime minister for failing to disclose his personal stake in the project.