A few months after the collapse of Terra/Luna, one of the hottest stablecoin projects, South Korea is calling for the arrest of its founder, Do Kwon.
A South Korean court issued an arrest warrant for the 31-year-old on Wednesday. Several arrest warrants have also been issued against five other people involved in the case, but who have not been named.
The spectacular collapse of TerraUSD and Luna rocked cryptocurrency markets around the world. Do Kwon, also the founder of blockchain platform Terraform Labs, has been accused of fraud by investors following the collapse, and South Korean authorities have opened multiple criminal investigations into the matter.
The principal concerned denies being on the run
The collapse of the Terra/Luna project resulted in losses of over $500 billion. Experts say May’s massive crash was inevitable because Do Kwon’s cryptocurrency model was flawed.
TerraUSD presented itself as a stablecoin, a class of digital assets designed to ensure a stable price, usually pegged to another value. TerraUSD was an algorithmic stablecoin, using a code to keep its price at around US$1.
Rumors suggested at the end of last week that the fugitive could be in Singapore. However, Do Kwon on Sunday denied being at large after Singapore police said he was not there. In the weekend he wrote on Twitter that he had not fled, without revealing its exact location. “We are defending ourselves in multiple jurisdictions – we have set ourselves extremely high standards of integrity and look forward to clarifying the truth in the coming months,” he said.