South Korean Do Kwon presided over one of the biggest busts ever in the volatile crypto sector. His Terraform Labs Pte created the TerraUSD stablecoin, which was meant to have a constant $1 value via a complex mix of algorithms and trader incentives involving a sister token, Luna. Their combined value soared past $60 billion until confidence in the system evaporated in May 2022, prompting investors to flee and denuding the tokens of value. With Kwon’s whereabouts unclear, South Korea issued an arrest warrant on allegations including breaches of capital-markets law. He denied any wrongdoing or being “on the run.” But he became the subject of an Interpol red notice and was arrested in Montenegro in March 2023, sparking dueling extradition requests from South Korea and the US. A court in Montenegro ruled a year later that Kwon should be sent to South Korea, but the country’s Supreme Court suspended that decision on March 22. Extradition to either country is now possible only after further deliberations by the court.
Kwon, 32, left Stanford University in 2015 with a computer science degree, his LinkedIn profile shows. He had stints at Apple Inc. and Microsoft Corp. before, as he puts it, falling “down the crypto rabbit hole.” Kwon co-founded Terraform Labs in 2018, one of many young coders who saw digital ledgers as a gateway to financial revolution. His project of creating a stable digital currency outside of mainstream finance and regulators wooed a legion of followers but also critics who said it was a doomed Ponzi scheme. At times brash and combative, Kwon trolled naysayers online, telling one critic that the Luna community was not as “poor as your broke ass.” As his project imploded, he said he was “heartbroken about the pain my invention has brought on all of you.”
