Do Kwon ‘not expected to resist arrest’ as warrant is issued over Terra crypto collapse
Legal chiefs in South Korea have today issued an arrest warrant for Terraform Labs founder Kwon Do-hyung.
Do Kwon, as he is more widely known, is the mastermind behind the Terra ecosystem which collapsed earlier this year, triggering a cryptocurrency crash which saw investors lose fortunes.
Seoul’s central court this morning issued a warrant for the 31-year-old developer together with five other Terra employees.
The arrest documents are understood to list a series of allegations pertaining to violations of South Korea’s capital markets law.
Prosecutors say the warrants were all addressed to six individuals who reside in Singapore.
Do Kwon is not expected to resist the warrant or go through a lengthy process of extradition to his homeland of South Korea. The Stanford University-educated father-of-one has said several times that he would be willing to cooperate with authorities over the collapse of Terra.
In a recent YouTube interview he was probed about the prospect of spending time in jail over his part in the scandal, to which he responded by saying “life is long”.
It is estimated that more than 200,000 investors were affected by the demise of the Terra USD stablecoin and the Luna token. Some 2,000 individuals are currently processing law suits against Do Kwon.
Leading up to the collapse, Kwon had spent months mocking global financial experts who warned that Terra’s business model was fatally flawed.
When critics – including UK economist Frances Coppola – lambasted Terra’s ‘algorithmic stablecoin’, Kwon responded publicly by labelling them ‘cockroaches’.
In other unseemly spats he said he drew entertainment from watching companies collapse, before answering a question on where yield reserves from the ‘Anchor Protocol’ were coming from with a bizarre “Your mom, obviously”.
Prior to their collapse, both Terra USD and Luna had a combined value of more than $60 billion. In May, they became almost worthless and, in the eyes of many analysts, lit the fuse on a wider cryptocurrency crash which has still not recovered.
Kwon also became a father for the first time this year, naming his daughter ‘Luna’ – his ‘dearest creation named after my greatest creation’.
He was recently asked if the name had now burdened his daughter with a lifetime of association to a massive financial failure.
“Let’s just say I have an incentive to make sure that her name isn’t something she should be ashamed of, but something that she can be proud of,” he replied.
“We’re not going to change her name or anything like that.”