Kwon Do-hyeong, also known as Do Kwon, the South Korean crypto entrepreneur facing fraud charges, has been arrested in Montenegro, according to reports.
Kwon founded the blockchain platform behind the TerraUSD stable coin and Luna coin—both digital currencies lost their value in May last year, leading to a $40billion collapse in the crypto market. This further sparked panic in the crypto market, and triggered a sell-off in major cryptocurrencies such as Bitcoin, Ethereum and Tether.
US regulators accused Kwon and his company Terraform Labs of "orchestrating a multi-billion dollar crypto asset securities fraud". Kwon went into hiding after an arrest warrant was issued against him in September, the Washington Post reported. His Twitter account, too, has also been inactive since then. South Korean authorities also issued an arrest warrant against Kwon last September.
The US Securities and Exchange Commission said Kwon misrepresented the stability of TerraUSD, once among the top 10 cryptocurrencies by market value. “We allege that they committed fraud by repeating false and misleading statements to build trust before causing devastating losses for investors," SEC had said.
Sharing the news of his arrest Montenegro's interior minister Filip Adzic said on Twitter that "one of the world's most wanted fugitives" had been detained at Podgorica's airport. South Korea police has confirmed that the suspect in Montenegro was Mr Kwon, after his fingerprints matched official records, BBC stated in a report on Friday. Police reportedly also recovered forged passports of Costa Rica and Belgium.
Kwon's arrest comes at a time of turmoil in the cryptocurency market. In November cryptoexchange FTX went bankrupt, and its founder, Sam Bankman-Fried, was later charged with fraud. Kwon was well regarded and his fans called themselves “Lunatics” after his Luna token. He graduated from Stanford University and briefly worked for Apple before founding several crypto projects, Washington Post reported.