Crypto Founder Do Kwon Indicted in US After Montenegro Arrest

Image copyright: Reuters [via Al Jazeera]

The Facts

  • On Thursday, South Korean entrepreneur Do Kwon, who is accused of orchestrating the $40B collapse of cryptocurrencies TerraUSD and Luna, was charged with fraud in the US following his arrest in Montenegro.

  • The arrest of the crypto entrepreneur, confirmed by local Montenegrin government authorities, came after months of searching for him. According to police, he was found at Podgorica airport attempting to board a flight to Dubai with multiple fake passports. He was formally charged with forgery on Friday.

The Spin

Narrative A

The Securities and Exchange Commission has a strong case against Kwon and Terraform Lab for misrepresenting the risk of TerraUSD and misleading US investors, who purchased billions of dollars of the digital assets, wiping out their savings and igniting the "crypto winter." Not only should Kwon be held accountable, but more importantly, financial regulators must clean up the cryptocurrency market by way of stricter regulations.

Narrative B

If found guilty, Kwon should undoubtedly be held accountable, however, one bad apple isn't indicative of an entire industry and this shouldn't be used to push the case for crypto regulation — a policy based on fear. Such a move will only hurt innovation and come at the expense of crypto companies that will have to foot the bill to accommodate new rules.

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