- Kwon has been charged in South Korea for wiping out investors’ funds.
- The blockchain firm is being investigated for fraud and tax evasion.
- The collapse of the Terra USD and Luna cryptocurrencies put a number of young investors into a state of panic and blew up their overall assets.
Law enforcement agencies, on a global level, have been asked by Interpol to find and arrest Do Kwon. As we all know, the blockchain startup of the Terraform Labs founder crashed in the beginning of 2022; thereby, wiping out $40 billion of investors.
In the past several weeks, a number of industry executives have mentioned that the notice might set an unfavorable example for the cryptocurrency industry and damage innovation, if Kwon has not intentionally defrauded customers and investors.
On a podcast, Managing Partner of Dragonfly, Haseeb Qureshi, said:
Having met Do Kwon … leaving how he is a person aside … I think the criminalization of Terra is a dangerous precedent.
However, he also mentioned not knowing the exact details just like others.
In recent weeks, South Korean prosecutors have increased the probe into Kwon and accused him earlier in September for not cooperating besides being on the run. Earlier this month, they urged Interpol to issue a red notice for the entrepreneur.
In May, Terraform Labs’ crypto LUNA and stablecoin UST were severely impacted after investors no longer showed faith in the potential of its fundamentals. Upon taking approval from the Terraform community, Kwon revamped the crypto project; however, ignored the algorithmic stablecoin element.
LUNA token’s collapse led to the wipeout of Three Arrows Capital, which used to be a leading crypto hedge fund. Also, it affected many crypto lenders which also includes BlockFi.
Ever since South Korea has issued an arrest warrant against Kwon, several investors have sold their positions in the revamped Luna token.
In a tweet this month, Kwon said that they are defending themselves in various jurisdictions. Holding on to a severely high bar of integrity, they are on their way of clarifying the truth.
We are in the process of defending ourselves in multiple jurisdictions – we have held ourselves to an extremely high bar of integrity, and look forward to clarifying the truth over the next few months— Do Kwon 🌕 (@stablekwon) September 17, 2022
A few days back, Today NFT News reported when an arrest warrant was issued against Do Kwon for violating the capital markets law.