Luna crashes below $3 after S. Korea issues arrest warrant for Terraform Labs founder Do Kwon

  • An arrest warrant has been issued in South Korea for Terraform Labs founder Do Kwon as investigations of the crypto company continue.
  • Terraform Labs’ stablecoin UST and cryptocurrency LUNA shocked investors and the crypto community in May when they lost $40 billion in value in a matter of days following major selloffs.
  • UST lost its $1 peg, resulting in Luna’s value dropping to $0, marking a significant collapse for a cryptocurrency that was worth over $115 just a couple of weeks prior.
  • South Korean authorities conducted a raid on the home of Terraform Labs co-founder Daniel Shin in July as part of their investigation into alleged illegal activity that resulted in Terra’s crash.
  • Last month, Kwon claimed that he had not been in contact with prosecutors and denied that he had been charged with anything despite reports that Terraform Labs' employees have been placed on a no-fly list.
  • The revived Luna token, which had recently climbed to almost $7, has now dropped to $2.73 as of this writing.

A South Korean court issued an arrest warrant for Terraform Labs founder Do Kwon on Wednesday as authorities continue their investigation of the blockchain company. 

Earlier this year, Terraform Labs’ stablecoin UST and cryptocurrency Luna lost $40 billion in value in a matter of days following major selloffs.

When UST lost its $1 peg in May, Luna’s value plunged to $0, which marked a remarkable collapse for a cryptocurrency that was worth over $115 just a couple of weeks prior.

At the time, major crypto exchanges such as Binance and Coinbase delisted the token and halted some of its trading pairs. 

The revived Luna token, which had recently climbed to almost $7, has now dropped to $2.73 as of this writing.

Kwon was among six individuals issued arrest warrants for allegedly violating South Korea’s capital market laws.

News emerged in June that local authorities barred Terraform employees from leaving the country. Kwon would later claim that he had not been in contact with prosecutors and denied that he had been charged with anything.

“It’s kind of hard to make that decision, because we’ve never been in touch with the investigators,” Kwon told Coinage last month. “They’ve never charged us with anything.”

In July, South Korean authorities conducted a raid on the home of Terraform Labs co-founder Daniel Shin as investigators dug into an alleged illegal activity that resulted in Terra’s crash. Kwon was also advised to notify local authorities once he returns to South Korea.

In May, a disgruntled investor who claimed to have lost $2.3 million from Luna’s collapse trespassed into Kwon’s apartment building. The man, who faced a trespassing charge, said he wants Kwon to apologize to over 200,000 investors who lost their money, some of whom reportedly committed suicide. 

 

Featured Image via Coinage

 

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