"People are stupid, really," Court documents reveal: Do Kwon discusses fake trades, PoS staking rewards

Terraform Labs co-founder Do Kwon has objected to the evidence presented by the SEC in recent court filings, which include a conversation between him and co-founder Daniel Shin discussing how to operate to attract investors.

Manufacturing Trades to Boost Investor Interest

In conversations revealed in court documents, Terraform Labs founders Do Kwon and Daniel Shin discussed creating fake trades that appear real to generate more interest from investors. These trades would incur costs and cease once Daniel Shin's payment app Chai gains traction.

Do Kwon's legal team claims that Kwon and Shin were discussing the possibility of validators staking LUNA tokens, not creating fraudulent Chai trades. They have requested the court not to consider this irrelevant evidence.

Discussing PoS Staking Rewards: People are Dumb, Really

Upon reviewing the conversation documents, it was indeed found that Do Kwon and Daniel Shin were discussing PoS staking rewards. They discussed ways to make investors more willing to stake and make the valuation appear larger.

Do Kwon mentioned that other PoS chains offer 6-12% annualized staking rewards. Daniel Shin expressed surprise, asking how is that possible.

Do Kwon explained that yes, they are just printing that much money.

Daniel Shin questioned, is this a Ponzi scheme?

Do Kwon replied, no, people are just dumb, really. They just give stakers currency inflation.

Meanwhile, Kwon's lawyer is requesting the U.S. court to reject the SEC's request to extradite him to the U.S. as Kwon, currently detained in Montenegro without a scheduled release time, cannot comply with this request.

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