Interpol has issued a red alert to Do Kwon, urging law enforcement agencies around the world to locate and arrest the Terraform Labs founder whose blockchain startup collapsed earlier this year, wiping out investors’ $40 billion.
Kwon is facing charges in South Korea for wiping out investors’ money, the prosectors say.
The notice against Kwon – which a spokesperson for South Korean prosecutors confirmed to londonbusinessblog.com – could set a false precedent for the crypto industry and hurt innovation, especially if Kwon has not knowingly defrauded investors and customers, several industry executives have recently charged. weeks said. .
“After meeting Do Kwon… aside from how he is a person… I think the criminalization of Terra sets a dangerous precedent,” Haseeb Qureshi, Managing Partner of crypto investment fund Dragonfly, said on a recent podcast. However, Qureshi warned that like many others, he does not know all the details.
South Korean prosecutors have doubled their investigation into Kwon in recent weeks, accusing him earlier this month that the entrepreneur was “uncooperative” and “clearly on the run,” a day after Kwon stated otherwise. They requested Interpol, the global law enforcement agency, to issue a red warning for Kwon earlier this month.
Terraform Labs’ so-called stablecoin UST and cryptocurrency LUNA imploded dramatically in May after investors lost faith in the effectiveness of its fundamentals. With the approval of the Terraform community, Kwon has revived the crypto project, but has avoided the so-called algorithmic stablecoin component for the time being. The depegging of TerraUSD (UST), the company’s previous stablecoin, led to the crash of LUNA token as they were intertwined.
The crash of LUNA token has also contributed to the destruction of Three Arrows Capital, once a high-profile crypto hedge fund. The fund’s demise severely impacted a number of cryptocurrency lenders, including BlockFi, from whom it had borrowed billions of dollars.
South Korea earlier this month issued an arrest warrant for Kwon, a move that saw many investors sell their positions in revived Luna token. “We are in the process of defending ourselves in multiple jurisdictions – we have held ourselves to an extremely high bar of integrity and look forward to clarifying the truth in the coming months,” Kwon said in a tweet this month.