Terra’s LUNA Sees Selloff Following Founder Do Kwon’s Arrest In Montenegro

Terra network’s native tokens dropped slightly amid reports of founder Do Kwon getting arrested in Montenegro on March 23. South Korean officials have visual confirmation that Kwon was indeed taken into custody within the territory of the Balkan nation.

Interpol has wanted Kwon for his role in the spectacular collapse of the Terra ecosystem back in May 2022.

Do Kwon Finally Arrested

The law has finally caught up to Terraform Labs CEO Do Kwon.

Kwon has been apprehended by Montenegrin police at the airport in the capital city of Podgorica, according to Montenegro’s Interior Minister Filip Adzic.

“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,” Adzic tweeted.

South Korean media house Yonhap said authorities had confirmed, based on “photo data,” along with the name, nationality, and age of an identification card that the arrested individual was the same person as Terra boss Kwon.

However, Korean police are reportedly waiting on fingerprint data from their counterparts in Montenegro to fully verify that the person behind bars is in fact the fugitive crypto entrepreneur due to claims the individual detained was in possession of falsified documents.

The apprehension comes nearly a year after the implosion of the Terra ecosystem in May, an event that sent shockwaves across the industry and triggered the failure of several high-profile crypto firms such as Three Arrows Capital. 

It entailed the collapse of the algorithmic stablecoin TerraUSD (USTC) and its companion token LUNA (LUNC), swiftly wiping out over $60 billion in investors’ wealth as the coins careened to virtually zero. The downfall sent the price of bitcoin (BTC) falling from around $40,000 to $26,000 in the span of two weeks.

South Korean officials issued an arrest warrant for Kwon in September 2022, months after they raided the offices of seven local crypto exchanges as part of an investigation into the collapse of Terra blockchain’s tokens. Kwon was later added to Interpol’s red notice list, making him a wanted man in 195 countries worldwide.

Korean investigators reportedly traveled to Serbia in February in a bid to track down Kwon. Notably, Montenegro is geographically south of Serbia and shares borders with the nation. He, therefore, might have been trying to flee Serbia by entering Montenegro.

The price of LUNA quickly nosedived after the announcement of Kwon’s apprehension, falling from $1.40 to $1.31 at press time, posting a loss of 3.4%  over the past day, CoinGecko data shows.

Separately, Do Kwon is facing charges in the United States for selling unregistered securities and misleading investors about the TerraUSD stablecoin.

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