Terra founder Do Kwon at risk of Interpol red notice as net tightens

SEOUL – South Korean prosecutors have asked Interpol for help in arresting Do Kwon, the progenitor of a US$60 billion (S$84.5 billion) cryptocurrency wipeout, as they seek to charge him with alleged crimes including breaking capital-markets laws.

“Prosecutors on Monday have made a request to Interpol for their assistance to locate Kwon, whose whereabouts remain unknown, and to have him handed over to Korea,” the prosecutors office said late Monday (Sept 19) in a text message.

Interpol would typically issue a red notice seeking assistance from law enforcement globally to make an arrest after receiving an official request for help. It could take about a week before a notice is issued.

Kwon had moved from South Korea to Singapore, where his now collapsed Terraform Labs project had a base, but the city-state says he’s no longer there. Kwon has denied being on the run, even as prosecutors in Seoul seek his detention and say he’s trying to avoid redress.

There has been “circumstantial evidence of escape” ever since he left for Singapore, and that is why an arrest warrant was issued in the first place, the prosecutors’ office said earlier.

The implosion of the TerraUSD algorithmic stablecoin and its sister token Luna sparked huge losses in crypto markets, which were already reeling from tightening monetary policy. Digital assets have yet to recover and regulators are pouring over the wreckage to see how to avoid a repeat. In South Korea, earlier ardor for crypto is being usurped by growing disdain.

Kwon tweeted over the weekend that he doesn’t “have anything to hide” and is in “full cooperation” with officials but didn’t publicly reveal his location.

“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 also said on Twitter.

However, the Yonhap News Agency in a report cited prosecutors as saying that Kwon is not cooperating with probes and has told investigators via an attorney that he has no intention of appearing before them for questioning.

Kwon faces arrest in South Korea along with five others over the Terra unraveling. Officials could cancel his passport, which in theory would require him to return to Seoul within 14 days of receiving the notice of revocation.

He has a Singapore employment pass which is due to expire Dec 7 and an application for another pass is pending, government records show.