A South Korean court issued a warrant of arrest for Do Kwon, co-founder of the defunct Terraform Labs. The crypto trader, along with five other individuals, is being charged with violation of the country’s Capital Markets Act.
The warrant, as told by the Supreme Prosecutors’ Office to Bloomberg News, comes after the firm’s stablecoin TerraUSD fell below its dollar peg and its LUNA coin crashed in value–overall losing around US$40 billion in the total Terra ecosystem. The collapse caused a wave of devaluation among leading crypto platforms like Voyager Digital, Celsius, and Three Arrows Capital.
Some reports say that Do allegedly cashed out US$80 million each month leading up to the Terra crash.
About a month after the crash, Terra attempted to revive its blockchain by introducing Terra 2.0. It still uses the Luna coin–now called Luna Classic–and has rebranded the newly issued coins as Luna.
Following the news, Luna investors rushed to protect the digital asset, distancing the coin from the arrest warrant issuance for Do.
Shortly after the legal action made the headlines, Luna’s price dropped a third of its value.
However, another related coin made gains.
Information for this briefing was found via Coindesk and the other sources mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.