Do Kwon, the South Korean founder of cryptocurrency company Terraform Labs, insisted that he is not running away from the country’s authorities. His insistence followed the prosecutor’s office of South Korea accepting an international arrest warrant from the International Criminal Police Organization (Interpol).
Kwon’s firm was responsible for the stablecoin TerraUSD and its sister crypto token Luna, which is worth around $60 billion combined. Both collapsed in May 2022, with many others in the crpyto industry feeling the repercussions – including optimistic hedge fund Three Arrows Capital.
A spokesperson for the Seoul Southern District Prosecutor’s Office confirmed to CNBC on Sept. 27 that Interpol has released a “red notice” for Kwon. According to Interpol, red notices are published for fugitives that must face prosecution or serve a sentence. The notices serve as request for law enforcement agencies worldwide to locate and arrest suspects, which could lead to extradition proceedings. (Related: South Korea requests Interpol red notice in search for disgraced crypto developer Do Kwon.)
The disgraced executive insisted that he was not fleeing, even using his Twitter account to push back. “I’m writing code in my living room,” he tweeted in response to someone asking about his location. Kwon added that he is making “zero effort to hide,” even commenting that he goes on walks and to malls.
Moreover, the Terraform Labs founder pointed out that he does not see his name on Interpol’s “red notice” list and that the world law enforcement agency does not always publicize these notices.
According to the prosecutor’s office, the purpose of the red notice is to locate Kwon wherever he hides and return him to South Korea. Officials will then decide within 48 hours whether to issue an arrest warrant for him.
Kwon stated on his Twitter that he is in Singapore, which the Singapore Police Force (SPF) denied on Sept. 17.
“Do Kwon is currently not in Singapore,” the SPF stated. “SPF will [nevertheless] assist the Korean National Police Agency within the ambit of our domestic legislation and international obligations.”
Aside from Kwon, arrest warrants were also issued to five other individuals connected to crypto tokens from Terraform Labs for violating South Korea’s Capital Markets Act.
South Korean prosecutors reportedly requested that Interpol issue a red notice to Kwon, which it granted four months after tokens from Terraform Labs crashed.
TerraUSD collapsed, losing $40 billion in value as a result. Its sister token Luna, meanwhile, fell from a $116 high to less than a cent in April. Global investors allegedly lost approximately $42 billion, prompting South Korean authorities to take legal action.
Prosecutors in Seoul also requested the South Korean Ministry of Foreign Affairs to revoke Kwon’s passport. They also requested crypto exchanges KuCoin and OKX to freeze his crypto assets worth about $65 million.
However, the beleaguered crypto executive denied accusations that he is on the run.
“We are in the process of defending ourselves in multiple jurisdictions,” Kwon tweeted. We have held ourselves to an extremely high bar of integrity and look forward to clarifying the truth over the next few months.”
Terraform Labs also rejected South Korean charges over the collapse and stated the case against Kwon had become “highly politicized.”
A company spokesman declared in a statement that prosecutors had shown “unfairness and a failure to uphold basic rights guaranteed under Korean law,” adding that there is “no reasonable basis” for their allegation of breaches of capital markets law.
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