The South Korean Ministry of Foreign Affairs announced yesterday that the passport of Terra’s Do Kwon would be canceled in 14 days.
The Ministry also ordered that the passport be returned to authorities.
The statement read, “if you [Kwon] keep the passport, the validity of your passport will be invalidated (administratively invalidation).” Kwon, if he chooses not to surrender his documents, will not be allowed to use them and will be restricted from a reissuance, making it difficult for him to leave South Korea or complicated to live abroad.
Kwon is the co-founder of Terraform Labs, the team behind the now-collapsed crypto project Terra. Terra, and its stablecoin UST and governance token LUNA, imploded in May, wiping out roughly $40 billion in investors’ money along the way.
Over the past few weeks, though, the search for the co-founder has reached a fever pitch.
On September 14, South Korean authorities issued an arrest warrant for Kwon, charging him with violating the country’s capital markets act. Shortly after, the Korean Ministry of Finance began work to void the crypto founder’s passport.
As the hunt for Kwon continued, Interpol approved South Korean prosecutor’s request to issue a red notice for him.
Interpol red notices are issued for fugitives wanted either for prosecution or to serve a sentence, acting as a request to law enforcement worldwide to locate and provisionally arrest a person pending extradition, surrender, or similar legal action.
Do Kwon and Terra
Terra was launched in 2020, introducing the world to its algorithmic stablecoin UST. It wasn’t until the end of 2021, though, that the project really began to gain traction.
Terra’s UST market capitalization. Source: CoinGecko.
Even as Bitcoin began dropping from its all-time high of roughly $68,000 last winter, the stablecoin’s market capitalization continued to grow. From November 2021 to May 8, UST grew from $2.7 billion to $18.7 billion.
Much of this growth was driven by Terra’s then-popular lending protocol Anchor which offered investors up to 20% for their UST deposits.
That has all ended now, though. UST, now called TerraClassicUSD (USTC), currently trading at less than $0.03 and LUNA well below that at $0.00029.
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