South Korean authorities have issued an arrest warrant for Terra (CRYPTO: LUNA) founder Do Kwon and five others in connection with the Terraform Labs case, Bloomberg reported on Wednesday.
What Happened: A local media publication reported earlier on Wednesday that the warrant was issued in relation to a violation of capital market rules.
Terraform Labs is the issuer of now-defunct stablecoin Terra USD (CRYPTO: UST), and cryptocurrency LUNA, which was valued at over $40 billion at one time before its dramatic collapse.
Why It Matters: The demise of the Terra ecosystem had far-reaching consequences for the wider crypto economy, sending market-leading cryptocurrencies Bitcoin (CRYPTO: BTC) and Ethereum (CRYPTO: ETH) into a downward spiral.
The aftermath also led to the demise of several large players within the industry, including the bankruptcy of hedge fund Three Arrows Capital(3AC).
In an interview with Coinage in Singapore last month, Do Kwon said he hardly slept in the eight days that followed Terra’s collapse.
“If you’re asking me if there was a mole at Terraform Labs, that’s probably a yes. Whether somebody tried to take advantage of that particular opportunity, that’s probably a yes,” said Kwon at the time.
“But if those opportunities existed, that’s on the person who provided those vulnerabilities in the first place… that’s me.”
Price Action: Terra Classic (CRYPTO: LUNC) has rallied 230% in the last 30 days, as per data from Benzinga Pro. Terra (CRYPTO: LUNA) rallied 61% over the same period.
Photo Courtesy: Terraform Labs
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