US prosecutors charge crypto Terra founder Do Kwon with fraud following his Montenegro arrest

·1 min read
SEC building
This photo from Wednesday Dec. 17, 2008, shows the Securities and Exchange Commission (SEC) headquarters in Washington.AP
  • US fraud prosecutors charged Terraform Labs CEO Do Kwon hours after his arrest in Montenegro.

  • Kwon created two cryptocurrencies TerraUSD and its sister affiliate Luna that lost $40B last year.

  • He now faces an eight-count indictment, including securities and commodities fraud and conspiracy.

Do Kwon, Terraform Labs CEO and creator of the TerraUSD stablecoin, has been charged with fraud by US prosecutors hours after his arrest in Montenegro on Thursday.

Prosecutors at the US attorney's office in New York have slapped an eight-count indictment against Kwon, including securities fraud, wire fraud, commodities fraud and conspiracy, according to a Reuters report.

The criminal case comes after the US Securities and Exchange Commission charged Kwon and Terraform Labs with alleged fraud last month. He was already a fugitive from an arrest warrant issued by authorities in his native country South Korea.

Kwon was the crypto entrepreneur behind the two digital currencies TerraUSD and its free-floating sister affiliate Luna that lost upward of $40 billion last year. The collapse of his Singapore-based Terraform Labs and that of the TerraUSD stablecoin sparked a broader crypto sell-off and wreaked havoc in the digital asset sector. 

If US prosecutors extradite Kwon to New York, he would face prosecution by the same office who is looking over a criminal case against FTX c0-founder Sam Bankman-Friend, who was transferred from the Bahamas to face fraud charges after his crypto empire collapsed.

Read the original article on Business Insider