Terra Co-Founder Do Kwon Arrested In Montenegro

Interpol has confirmed the identity of a man arrested in Montenegro as Kwon Do-hyeong, also known as Do Kwon, the disgraced founder of collapsed crypto company Terraform Labs.

The identity of Kwon, a South Korean national, was confirmed via a fingerprint match, Interpol’s national central bureau in Seoul told CNN on Friday.

Kwon was reportedly arrested on Thursday, after Montenegrin Internal Affairs Minister Filip Adžić wrote on social media that a man believed to be Kwon had been arrested in the capital Podgorica.

Kwon arrest

“He was arrested at the airport with counterfeit documentation and is wanted by several countries, including the USA, South Korea, and Singapore,” Adžić reportedly wrote in a Facebook post.

A day later after his arrest, his identity was confirmed by a fingerprint match.

In 2022 Do Kwon had moved from South Korea to Singapore with his family following the collapse of his $40 billion digital asset project – which included the stablecoin Terra and its sister token Luna.

It is thought that nearly 250,000 people had invested in Terraform Labs’ coins, and blockchain analytics firm Elliptic estimated that investors in TerraUSD and Luna lost an estimated $42 billion.

The reclusive Kwon insisted neither he nor his company made money on the crash, but he did not exactly help his cause.

He is known for his caustic remarks about detractors, and told a YouTube crypto channel a week before the demise of TerraUSD, “95 percent [of coins] are going to die – but there’s also entertainment in watching companies die too.”

Just before the implosion he told followers on Twitter, “I love chaos.”

But on 13 May 2022 he tweeted, “I am heartbroken about the pain my invention has brought on all of you.”

On the run?

But authorities did not agree with his protestations of innocence and in September 2022 South Korea issued an international arrest warrant for Do Kwon, as well as five other unnamed people he worked with at Terraform Labs.

Interpol also issued a “red notice” for his arrest.

The arrest warrant alleged violations of the South Korea’s capital markets law, and all six individuals were said to be located in Singapore.

The only problem was that Do Kwon was nowhere to be found.

Do Kwon has previously denied that he is in hiding or on the run, but he did not reveal his whereabouts after police in Singapore could not locate him.

In December South Korean police said they believed Do Kwon was hiding in Serbia, after he had travelled via Dubai to an unknown country after leaving Singapore.

South Korean police last month travelled to Serbia to track him down.

South Korea and Serbia do not have an extradition treaty, but in the past both have agreed to requests under the European Convention on Extradition.

SEC charges

Last month the US Securities and Exchange Commission (SEC) said it had “charged Singapore-based Terraform Labs PTE Ltd and Do Hyeong Kwon with orchestrating a multi-billion dollar crypto asset securities fraud involving an algorithmic stablecoin and other crypto asset securities.”

Terraform Labs was responsible for TerraUSD, a stablecoin which in theory was meant to retain a $1 price point.

The SEC in its complaint alleged that from April 2018 until the scheme’s collapse in May 2022, Terraform and Kwon raised billions of dollars from investors by offering and selling an inter-connected suite of crypto asset securities, many in unregistered transactions.