Crypto king arrested in Montenegro

Crypto king arrested in Montenegro
/ bne IntelliNews
By bne IntelliNews March 24, 2023

Montenegro’s police arrested fugitive crypto-king Do Kwon, co-founder of Terraform Labs, on March 23, Interior Minister Filip Adzic wrote on Twitter.

Kwon is charged by the US of being responsible for the loss of more than $40bn.

“Former crypto-king who is behind the loss of more than $40bn was arrested at Podgorica airport with false documents,” Adzic wrote.

Know is wanted in the US, Singapore and South Korea.

The collapse of terraUSD coin in 2022 caused an unprecedented crash in crypto markets that prompted a multibillion-dollar selloff across crypto markets.

Kwon was charged with fraud and breaches of capital markets law in South Korea. The South Korean authorities have issued international arrest warrant for him, after being unable to locate Kwon.

South Korean authorities had information in 2022 that Kwon has travelled to an unknown country, believed to be Serbia, via Dubai after leaving Singapore, where Terraform was headquartered. His South Korean passport was revoked.

The meltdown of terraUSD and luna coins affected hundreds of thousands of investors, who were attracted by a scheme in which clients could lend their terra coins for a yield of up to 20%.

TerraUSD, a stablecoin, was designed to connect traditional and crypto markets. Traders use them like cash or a store of value between crypto trades.

Kwon is also being sued by the US Securities and Exchange Commission for allegedly arranging a cryptocurrency fraud that led to billions of dollars in losses by selling a number of digital assets not properly registered with regulators.

In May last year, terraUSD’s peg collapsed, sparking an unprecedented crisis of confidence in crypto markets and led to the bankruptcy of companies such as Celsius and Three Arrows Capital.

In May 2022, the “algorithmic stablecoin” terraUSD turned off its blockchain and was delisted from major exchanges.

The collapse of terraUSD fuelled concerns among international regulators that the stablecoin industry

In September last year, Interpol issued a red notice against Kwon. Meanwhile, Kwon has continued to make statements on social media without sharing his location since his disappearance.