According to South Korean police, Do Kwon, the fugitive crypto entrepreneur behind the collapse of the terraUSD and Luna tokens valuation $40bn (£32.5bn), has been arrested at Podgorica airport in Montenegro. He has been charged with fraud by US prosecutors.
Do Kwon, the runaway leader of a cryptocurrency company responsible for the $40bn (£32.5bn) downfall of the terraUSD and Luna tokens, has been apprehended in Montenegro, according to South Korea police. He has been charged with fraud by US prosecutors.
In the beginning of this year, allegations were made by US regulators against Mr. Kwon and his company Terraform Labs, claiming that they were involved in a securities fraud related to crypto assets worth billions of dollars. Terraform Labs or any senior executives from his team did not respond to our journalist request for comment.
In September 2022, South Korean authorities issued an arrest warrant for Mr Kwon for violating capital market rules. Although they believed he was in Serbia, they never found him until now.
There are no extradition agreements between Montenegro and the United States or South Korea. This February, financial regulators of the United States stated that Do Kwon and Terraform Labs “failed to provide the public with full, fair, and truthful disclosure as required for a host of crypto asset securities, most notably for Luna and TerraUSD.”
According to US financial regulators, they repeatedly made false claims about the tokens’ potential value and misled investors regarding TerraUSD’s stability. The worth of the token and its associated Luna cryptocurrency then plummeted to nearly zero in May, causing a sell-off in major digital assets like BTC, ETH, and Tether. The outcome was the online trend of the term “cryptocrash.” According to blockchain analytics firm Elliptic, investors worldwide lost an estimated $42 billion in TerraUSD and Luna cryptocurrency.