Sep 14, 2022 Frank Stewskid

A warrant for Do Kwon’s arrest has been issued by a South Korean court

Just four months after the infamous collapse of the whole Terra ecosystem, its mouthy founder Do Kwon is facing serious trouble. A South Korean court has issued an arrest warrant for Terra’s CEO, according to Chosun Ilbo – a South Korean newspaper.

The warrant is said to be issued by the Seoul Southern District Prosecutors’ Office’s Joint Investigation Team of Financial Securities Crimes and Second Division of Financial Investigation. The warrant is going to be valid for one year, and prosecutors are counting on Interpol to carry out the arrest, as Do Kwon is believed to currently be residing in Singapore. Furthermore, besides Do Kwon, the South Korean court has also issued arrest warrants for Nicholas Platias, another founder of Terraform Labs – the company behind Terra, and also for Han Mo – an employee of the company.

According to the report, the trio is charged with violating the Capital Markets Act – a law effective since 2009 intended to improve the regulation of Korean capital markets by consolidating formerly used statutes. The Act founds a system that regulates all financial investment products traded in the capital markets. If found guilty – the three Terra team members can face fines including forfeiture and collection in addition to imprisonment.

Terra used to issue the TerraUSD stablecoin, once the third largest stablecoin by market cap, however, due to a flow in mechanics of the minting process of the algorithmic stablecoin, it lost its peg to the USD and never managed to regain it. This happened at the peak of Do Kwon’s daily assertive Twitter posts that the stablecoin can never depeg due to its mechanics. Even the Luna Foundation Guard tasked with safeguarding the peg of TerraUSD, holding assets worth over $1.5 billion at the time of the depeg, didn’t manage to help the failing stablecoin and Terra’s native LUNA token.

In the following months, Terra tried desperately to revive its ecosystem and even launched a new version of its native asset, but never managed to gain even a fraction of its former success.

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