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S.Korea prosecutors turn to Interpol to track Terraform Labs founder

Posted:Sep 19, 2022 16:12 Category: Blockchain , Crypto , Regulatory , Posted by AIBC Group

Prosecutors in South Korea have asked Interpol for help in tracking down Do Kwon, the founder of collapsed blockchain firm Terraform Labs.

The CEO and six others are under investigation for tax evasion and fraud after investors in the TerraUSD and Luna cryptocoins filed complaints, saying they had lost billions of won when the coins crashed in May.

The request to Interpol comes just hours after Do Kwon denied reports that he was on the run on Twitter.

“I am not on the run or anything similar – for any government agency that has shown interest to communicate, we are in full cooperation and don’t have anything to hide,” he wrote. “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 over the next few months.”

The tweets triggered a swift response from prosecutors on Sunday, who said the executive was quite clearly on the run, South Korean news agency Yonhap reported. 

Do Kwon had been thought to be in Singapore, although the city state put out a statement on Saturday saying he was no longer there. 

TerraUSD (TST) is a so-called stablecoin that aims to maintain a 1.1 value to the US dollar. The coin is not backed by assets and its value is set through a series of complex computer algorithms. 

However, this dollar peg broke in May sending TerraUSD and its sister coin Luna crashing to near zero in value. Globally, investors in the two coins lost an estimated $42 billion, according to blockchain analytics firm Elliptic, as cited by Reuters. 

The Terraform crypto crash roiled crypto markets around the world, leading to the failure of several crypto firms. 

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