Update: Korean authorities have now confirmed that the detainee is Do Kwon.
Montenegrin Vice President Philip Adzic confirmed the arrest of a person traveling to Montenegro, Podgorica – believed to be the fugitive Terra Do Kwon.
A translated statement from the VP read:
“Montenegrin police have detained a person suspected of being one of the most wanted fugitives, South Korean citizen Do Kwon, co-founder and CEO of Singapore-based Terraform Labs.”
In the tweet, Adzic named Do Kwon one of the world’s most wanted fugitives, adding that the person arrested was traveling with false documents.
Awaiting identity confirmation
In February, reports surfaced that Do Kwon was hiding in Serbia, which borders Montenegro to the north. A delegation including members of the South Korean Ministry of Justice and the Public Prosecution Service traveled to Serbia in search of the co-founder of Terra Labs.
Adzic said they are waiting for official confirmation of the detained person’s identity. The Korean authorities have since confirmed that the person arrested is Do Kwon, who was arrested with a tool.
“We checked the age, nationality and name with the identity card the person had, and confirmed that he was the same person as CEO Kwon with photo data.“
@FatManTerrawho worked to shed light on the alleged fraud during the height of the mania, provided a scathing summary of Do Kwon’s actions.
“He scolded a bogus ecosystem built on counterfeit transactions. He orchestrated a covert rescue operation and told the people that was the “power of his algorithm”. And when private investors committed suicide, he joked at their expense.“
He didn’t hold back and signed off, hoping that the “full force of the law” would descend upon him.
Terra implosion
On May 9, 2022, the UST stablecoin lost its dollar peg price, leading to a massive drop in its balancing asset, Terra LUNA.
As an algorithmic stablecoin, UST maintained its peg by moderating its supply by burning to decrease, or hitting to increase, in conjunction with the opposite action that occurred for the balancing asset.
Before the collapse, UST had become the third-largest stablecoin by market cap, earning itself some degree of legitimacy by achieving that. However, after the collapse – which was the first sign that things were not going well in the cryptosphere – the contagion effect rippled through the industry, creating liquidity problems elsewhere.
Investigations into the collapse unearthed damning allegations about the Terra ecosystem — including deliberate exploits in the Mirror Protocol designed to deflate insiders, the use of shell companies to launder money, and Do Kwon siphoning millions of dollars monthly from the project.
An estimated $40 billion was lost and many lives were ruined.
In an October 2022 interview with Laura Shin of the Unchained Podcast, Do Kwon said that allegations of fraud made against him by South Korean authorities were not legitimate.
In particular, Do Kwon said that cryptocurrencies, which are not classified as securities in the country, are outside the scope of applicable law, namely the Capital Markets Act.
