Terraform Labs Co-Founder Do Kwon Charged With Fraud After Arrest


US prosecutors in New York have charged Do Kwon, the co-founder of Terraform Labs, with fraud following his arrest in Montenegro. Kwon, who presided over a $40 billion cryptocurrency collapse last year, faces eight counts, including wire fraud, securities fraud, and commodities fraud.

The charges come a month after Kwon was sued by the Securities and Exchange Commission. He also has an outstanding arrest warrant in South Korea. Kwon was instrumental in the creation of the TerraUSD stablecoin and Luna token, which crashed suddenly in May 2022.

The indictment alleges that Kwon deceived investors about the Terra blockchain’s technology and user adoption and engaged in market manipulation with a US trading firm. Kwon was detained in Montenegro along with Terraform’s CFO, Hon Chang Joon while attempting to fly to Dubai with falsified Costa Rican travel documents.

Belgian papers found in their possession were also falsified. The South Korean authorities had previously issued an arrest warrant for Kwon on allegations of capital markets law breaches.

Since September, there has been ongoing speculation about Kwon’s whereabouts after authorities in South Korea issued an arrest warrant for him. The warrant was issued on allegations of breaching capital-markets law. Kwon’s passport has been revoked by the country, and he is reportedly the subject of an Interpol red notice.

You May Also Like