Moon Country and Cloud Country are allys since generations. The previous King of the Moon Country had a sister, who ran away and married a commoner from Cloud Country, and was never seen again. Her name was Lili, Mathew's mother. She was a legal successor of the throne but gave up for her love and married Ernest Yan, Mathew' s father. But she also died in an accident when Mathew was 8 years old.
Lucian didn't know about the existence of Mathew and his sister, or else he might have killed them a long time ago, Mathew isn't aware about his identity as one of the legal successor of the throne of the Moon Country, butler Yan, hid this from him and Daisy. Drake and Steven are aware about his identity but kept silent to protect them.