South Korean court orders arrest of Terra’s Do Kwon

LAGOS (CoinChapter.com) — A South Korean court has issued an arrest warrant for Do Kwon, the primary developer of failed cryptocurrency Luna and the founder of blockchain platform Terraform Labs.

In detail, a court in Seoul issued a warrant for Do Kwon and five others on allegations that they violated the nation’s capital markets law. According to the prosecutor’s office, all six individuals are currently located in Singapore.

The warrant comes a few months after Terra ecosystem collapsed its stablecoin (UST) and LUNA token. The tokens lost over $40 billion in value in a few days, and Kwon was accused of fraud by investors.

Terra’s collapse triggered investigations in South Korea and the US and renewed regulatory scrutiny of stablecoins. As a result, the company’s employees were barred from leaving South Korea in June amid an investigation. Moreover, in July, prosecutors raided the home of Terraform Labs co-founder Daniel Shin as the probe into the UST collapse deepened.

UST Stablecoin Wasn’t A Scam —Do Kwon

Meanwhile, in his first public interview last month, Do Kwon maintained that he cooperates with the authorities. The Terraform Labs co-founder rejected the idea that the UST stablecoin was a scam, insisting that it was working as intended until it suddenly stopped functioning.

ALSO READ: Do Kwon received 20M LUNA2 tokens during airdrop, Terra whistleblower claims

He also previously alleged that the South Korean prosecutors hadn’t been in contact with him, and he hasn’t been charged with anything. Kwon said:

“It’s kind of hard to make that decision because we’ve never been in touch with the investigators. They’ve never charged us with anything.”

Kwon also noted that he was determined to remain in the crypto industry for decades. However, it’s worth noting that the embattled entrepreneur is facing jail time for his role in the collapse of Terra.

LUNA Plunges 40%

Terra relaunched token LUNA slumped by almost 40% after news of the planned arrest of its founder, Do Kwon, broke. According to data from Coingecko, LUNA is currently trading at $2.5 and is poised to hit a new all-time low.

LUNA’s market cap has also lost over $350 million in the last 24 hours and currently sits at $460 million. At the time of publication, the token has a 24-hour trading volume of $1.2 billion and a circulating supply of 160 million LUNA coins.