EXTREME ON THE CRYPT: AN ARREST WARRANT HAS BEEN ISSUED IN SOUTH KOREA FOR THE FOUNDER OF THE TERRAFORM LABS BLOCKCHAIN PLATFORM

The South Korean authorities intend to arrest the scandalous entrepreneur Do Kwon, who is behind the collapsed Terra blockchain project. According to the local prosecutor's office, he and five other persons are accused of violating the norms of national law governing the capital market. At the same time, all the defendants in the case, the sources note, are presumably located on the territory of Singapore.

Do Kwon was at the center of the biggest scandal related to TerraUSD (another designation is UST). The digital currency, previously pegged to the US dollar, collapsed, causing the collapse of the entire Terraform Labs ecosystem. For many market participants, this has finally undermined faith in the reliability of digital assets. The crypto market has not recovered so far, having suffered significant losses.

The collapse occurred on May 8, 2022. After the tokens tied to the US currency in the amount of $ 300 million were sold at one time, the currency rapidly depreciated.

The Prosecutor's office of the country initiated an inspection of the organization on suspicion of creating a financial pyramid.

Soon, the Seoul prosecutor's office banned a number of the company's main developers from leaving the country. Thus, the authorities hoped not to lose the witnesses necessary for further investigation of the incident. However, judging by the current report on the receipt of an arrest warrant, it was not possible to detain persons suspected of violating the law.

The scandal surrounding Do Kwon and his company has caused a series of investigations not only in South Korea, but also in the United States. It was decided to resume control over digital tokens tied to volatile currencies (the so-called stablecoins). In July 2022, the house of another Terraform Labs co-founder, digital entrepreneur Daniel Sheen, was searched.

Another Pre-Kwon asset before the May financial disaster was the Luna token. Its value has also dropped to almost zero. And this is instead of $60 billion, in which both cryptocurrencies were estimated at the beginning of 2022.

The entrepreneur, accused by investors of fraud, eventually started creating a new version of Luna 2.0, which was distributed to the holders of the old versions at the end of May. To do this, the Luna Foundation Guard reserve fund had to sell bitcoins and other cryptocurrency savings worth billions.

Now, after it became known about the arrest warrant for Do Kwon, the value of the token has almost halved to $2.4. The total capitalization of Luna 2.0 is estimated by CoinGecko at $413.2 million. This means that it has decreased by 42%.

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