South Korea Issues Arrest Warrant for ‘Crypto King’ Do Kwon

South Korean court issues arrest warrant for Do Kwon, co-founder of failed cryptocurrency operator Terraform Labs, on suspicion of violating capital market rules after terra and luna tokens crashed $40 billion earlier this year Did.

The court on Wednesday also issued arrest warrants for five other people associated with Terraform Labs who are in Singapore, according to a spokesperson for the Seoul Southern District Public Prosecutors’ Office. Terraform Labs co-founder Daniel Shin isn’t among his five.

Prosecutors have accused Kwon of financial fraud, claiming that his terraUSD stablecoin is a kind of investment guarantee under South Korea’s capital market law. They believe Kwon is in Singapore, but did not disclose whether they have identified his whereabouts.

A spokesperson said prosecutors were exploring “many ways” to arrest him and extradite him from Singapore, including working with Interpol and invalidating his South Korean passport. Not included in the list of international extradition treaties.

Terraform Labs and Kwon were not immediately available for comment.

The bemused crypto entrepreneur said in an interview last month that he had no contact with South Korean authorities. The 31-year-old told cryptocurrency media startup Coinage that it was “a bit difficult” to decide whether to return to South Korea because he “has never been in touch with investigators.”

Sean Leung, a partner at international law firm Withers, said the Criminal Matters Mutual Aid Act allows Singapore authorities to provide assistance if requested by South Korean authorities.

If South Korean authorities issue an Interpol “red notice” to Mr Kwon, he “could face serious difficulties traveling outside of Singapore as he could be detained at the border during the trip.” Expensive,” he added.

South Korean prosecutors and police are investigating Kwon and his company after they filed two complaints on behalf of 81 investors, alleging that they deceived investors.

Kwon attended an elite foreign language high school in Seoul and studied computer science at Stanford University. In 2018, he co-founded Terraform Labs in Singapore, along with Daniel Shin, the prominent founder of e-commerce He Unicorn and Ticket Monster in South Korea.

The pair launched the terraUSD stablecoin in 2020. This stablecoin had an algorithmic relationship to the luna cryptocurrency, which peaked at $116 in early April. collapse to zero Just a few days in May.

The meltdown affected hundreds of thousands of investors, many of whom were drawn into schemes that allowed their clients to rent out their land at a 20% yield.

So-called anchor protocols, the mechanism by which a 20% yield is offered to investors, are understood to be one area of ​​research interest.

The huge losses incurred by Korean cryptocurrency investors Cheeky and divisive Kwon A villain in his native South Korea following media reports of multiple suicides related to the collapse.

In an interview with Coinage, Kwon said he considers himself one of the victims of the crash.

“I don’t want it to seem like my loss is greater in terms of emotional impact compared to people who had less to start over and then couldn’t start over. [in their] We couldn’t save lives and the Terra system went down,” Kwon said. “[But] This was essentially my life. . . I bet big and I think I lost. ”

Additional reporting by Mercedes Ruehl in Singapore South Korea Issues Arrest Warrant for ‘Crypto King’ Do Kwon

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