It’s now looking more and more evident that Do Kwon, the infamous founder of Terraform Labs and the man blamed for the $60 billion collapse of LUNA and UST, is heading to jail. According to South Korean authorities, Kwon has now been added to Interpol’s Red Notice list, making him a wanted fugitive in close to 200 countries.
South Korea has been going after Kwon and five of his Terraform colleagues over alleged violations of the country’s Capital Markets Act among other charges, issuing an arrest warrant for the 31-year-old two weeks ago. Days later, South Korean prosecutors urged the Foreign Ministry to invalidate his passport and force him back home. They also called on Interpol to issue a Red Notice against Kwon, drastically narrowing the number of countries he can run to.
As Bloomberg now reports, Interpol has heeded the call. Prosecutors in Seoul confirmed to the outlet that Kwon is now on Interpol’s infamous Red Notice. This request for law enforcement to locate and arrest a fugitive is enforceable in all the 195 countries that Interpol operates in. At press time, Kwon has yet to be added to the Interpol website.
The Red Notice is a quick escalation from just a few weeks ago when Kwon told off the digital asset world, reminding everyone that unless you’re playing a GPS-based Web3 game with him, you have no business knowing where he is.
The trash-talking Korean claimed a few months ago that he’s not on the run and he’s cooperating with regulators.
“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,” he stated.
South Korean authorities were quick to refute the claims, saying that he had refused to cooperate with investigators. Prosecutors further claimed that Kwon had, through his lawyers, told them he had no plan to appear for questioning.
Aside from the criminal violations in his home country, Kwon also faces a number of class-action lawsuits in the U.S. for “running a Ponzi scheme.”
Terra’s collapse has led many governments to reconsider how they regulate stablecoins. In the U.S., a new bill before Congress is seeking to ban all “endogenously collateralized stablecoins” such as UST for the next two years.
“I understand I’m buying a fugitive’s token” – Binance’s ludicrous Terra 2.0 warning
While he may be a wanted fugitive, Kwon is still beloved by the Crypto Crime Cartel, so much so that when he launched Terra 2.0, they all clamored to list it. LUNA2 launched barely a month after the original LUNA and its sister token UST cost investors $60 billion and major exchanges—from Kraken and FTX to Bitfinex and Binance—all listed it (but still no BSV).
However, with the walls closing in on Kwon, these exchanges can no longer bury their heads in the sand. For Binance, delisting LUNA2 isn’t an option. After all, why would the pot call the kettle black?
Binance’s big solution is to remind its users that by purchasing LUNA2, they are transacting a token launched by a fugitive. However, upon clicking “I understand,” users can continue trading LUNA2 unabated. As one blockchain sleuth summed it up, it’s tantamount to openly stating, “This token creator is a fugitive from South Korean justice. Now please click this big yellow button” and make us more money.
I guess this is what passes for an exchange taking responsibility for listing Terra. This token creator is a fugitive from South Korean justice. Now please click this big yellow button. pic.twitter.com/iTLOAplxWo
— Jacob Silverman (@SilvermanJacob) September 21, 2022
This admission by Binance comes amid a class-action lawsuit facing its U.S. subsidiary, Binance.US, for promotion and sale of UST and LUNA. The lawsuit by over 2,000 Binance.US users claimed the exchange advertised UST “as a safe asset that could be used to earn substantial returns, including in the form of interest.” Not only did Binance.US lie about the stability of UST, it also offered a security without attaining the necessary license, the lawsuit alleged.
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