Interpol has confirmed Kwon Do-hyeong’s arrest, alias Do Kwon, in Montenegro. Kwon is the disgraced founder of a collapsed crypto company that is wanted in South Korea and the US for fraud and other charges.
He founded the blockchain platform responsible for TerraUSD stablecoin and its sister coin Luna. Unfortunately, both coins lost their value within days, causing a loss of $40 billion in the crypto market, triggering panic in the speculative sector.
Interpol’s national central bureau in Seoul verified Kwon’s identity through a fingerprint match. This development sheds light on the extent to which fraudsters are exploiting the volatile crypto industry for personal gain.
The arrest of Kwon Do-hyeong highlights the need for greater regulation and scrutiny in the crypto space to protect unsuspecting investors.
How he Got Arrested
On social media, the minister of Montenegrin Internal Affairs, Filip Adžić stated that a man suspected of being Kwon Do-hyeong was apprehended in Podgorica, the capital city.
Adžić explained that the individual was arrested at the airport with fraudulent documentation and is being pursued by multiple countries, including the USA, South Korea, and Singapore.
Kwon was previously based in Singapore while managing the blockchain platform Terraform Labs. In December, Seoul prosecutors revealed to CNN that the crypto entrepreneur was believed to be hiding in Serbia after departing Singapore through Dubai.
The arrest of Kwon represents a significant step forward in the pursuit of justice for those affected by the collapse of Kwon’s cryptocurrency company and the subsequent loss of billions in the crypto market.
The authorities’ cooperation across borders highlights the importance of international collaboration in the fight against financial crimes, particularly in the ever-expanding world of digital assets.
Following the collapse of his company and subsequent accusations of fraud from investors, a South Korean court issued an arrest warrant for Kwon Do-hyeong in September.
What has the Crypto Fugitive Been Charged with
Kwon has been charged with fraud and violations of South Korea’s capital markets law. Despite the allegations, Kwon publicly expressed his disbelief in the legitimacy of the charges and asserted that they were politically motivated in October.
On Twitter, the crypto developer repeatedly refuted claims that he was “on the run,” citing concerns about his personal safety as the reason for his refusal to disclose his whereabouts.
Terraform Labs, under Kwon’s leadership, was responsible for the creation of TerraUSD, a stablecoin designed to maintain a fixed $1 price point.
The arrest of Kwon in Montenegro represents a significant milestone in the global effort to hold fraudulent actors accountable in the digital asset industry.
It remains to be seen how the legal proceedings will unfold in the US, South Korea, and other nations pursuing Kwon’s extradition.
The fall of TerraUSD and Luna, two interconnected cryptocurrencies, marked the beginning of the crypto winter.
The Crypto Industry’s War with Bad Actors
Despite experiencing another significant setback from the collapse of the FTX crypto exchange in November, the digital asset industry continues to grapple with the fallout from the Terraform Labs debacle.
The ripple effects of the loss of billions of dollars in the crypto market caused by the downfall of Kwon’s company are still being felt, contributing to a prolonged period of uncertainty and volatility.
The impact of such events underscores the need for greater vigilance and regulation in the digital asset industry to ensure the protection of investors and the overall stability of the market.
As the industry strives to recover and move forward, it must take lessons learned from these incidents to create a more secure and sustainable future for digital assets.
Do Kwon was only one out of the many bad actors walking around the crypto space and this case highlights the importance of taking proactive steps to safeguard investors from them.
The crypto space could definitely do better with tighter regulations and stricter protocols, encouraging more investors to enter this space.