The news has already stirred up the crypto ecosystem with many of the affected LUNA holders yet to recoup their losses.
Do Kwon, the co-founder of Terraform Labs, has reportedly been arrested in Montenegro, months after he went missing following the implosion of Terra (LUNA) and its algorithmic stablecoin UST. Do Kwon’s arrest was shared via a Tweet from Filip Adzic, the country’s interior minister.
At one point last year, Do Kwon was declared one of the world’s most wanted men by Interpol. transmitter a RED NOTICE for your arrest. Authorities in South Korea, Singapore, and even states in the United States have opened a direct investigation into Terraform Labs and the activities surrounding the collapse of the first iteration of LUNA.
The decoupling of UST was the birth of the yet to be settled crypto winter that has continued to plague the digital currency ecosystem. With the crash at the time, the estimated loss was pegged at around $40 billion as LUNA’s market capitalization was wiped out. LUNA, at the time, was on its way to being ranked as one of the top 10 largest cryptocurrencies in the world.
According to Adzic’s tweet, the identity of the arrested individual has yet to be fully determined despite the assumption that it was Do Kwon.
“Montenegrin police have detained a person suspected of being one of the most wanted fugitives, South Korean national Do Kwon, co-founder and CEO of Singapore-based Terraform Labs,” Adzic said in a tweet according to Google’s translation of his words. The minister added that;
“The former “king of cryptocurrencies”, who is behind losses of more than 40 billion dollars, was detained at the Podgorica airport with forged documents, and South Korea, the United States and Singapore are demanding the same. We are waiting for the official confirmation of identity.”
The news has already stirred up the crypto ecosystem with many of the affected LUNA holders yet to recoup their losses.
Aftermath of Do Kwon’s LUNA Collapse
The collapse of both LUNA and UST was singled out as one of the central mishaps that led to the bankruptcy of some of the industry’s dominant start-ups. The first company to implode was crypto lender Celsius Network, while hedge fund Three Arrows Capital (3AC) and brokerage firm Voyager Digital also fell down the rabbit hole last year.
The extensive interconnectedness of events behind the collapse of the blockchain protocol also led to the FTX Derivatives Exchange. presentation bankruptcy late last year. The connection and exposure to LUNA also dragged down Genesis Trading, a subsidiary of Digital Currency Group (DCG) that declared bankrupt at the beginning of this year.
While these events are the direct consequences of the LUNA implosion, the overall event has also brought intense scrutiny from regulators and lawmakers along the way. From that time to date, several regions, including Japan, have revamped their laws associated with stablecoins, as many sought ways to further protect customers.
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Benjamin Godfrey is a blockchain enthusiast and journalist who enjoys writing about the real-life applications of blockchain technology and innovations to drive mainstream acceptance and global integration of emerging technology. His desire to educate people about cryptocurrencies inspires his contributions to renowned blockchain-based sites and media. Benjamin Godfrey is a lover of sports and agriculture.
