Key Takeaways
- The past few months have seen Interpol issuing a red notice against Terraform Labs CEO, Do Kwon, and South Korean authorities requesting an arrest warrant for him.
- Prosecutors have asked the crypto exchanges KuCoin and OKX to lock a couple of funds that amount to 3, 313 Bitcoin
The past few months have seen Interpol issuing a red notice against Terraform Labs CEO, Do Kwon, and South Korean authorities requesting an arrest warrant for him. Yesterday, he broke his silence via a tweet, stating that he is not in hiding despite all the allegations made against him.
While prosecutors in South Korea have charged Kwon with financial fraud and breaking the country's capital market laws, they have also asked Seoul's foreign ministry to revoke his South Korean passport after some of his actions. Concerning all these, they are now seizing assets connected to Kwon on suspicion of breaching securities rules.
Prosecutors have asked the crypto exchanges KuCoin and OKX to lock a couple of funds that amount to 3, 313 Bitcoin (BTC), worth around $67 million at the time of writing. According to CoinDesk, it has been transferred from a wallet associated with Kwon's Luna Foundation Guard. Although reluctant to provide additional information, a representative of the Seoul Southern District Prosecutors' Office backed CoinDesk's report.
This development came after Kwon allegedly opened a new wallet on September 15, a day after a Korean court issued an arrest warrant for him. Crypto analysts report that a new Bitcoin wallet called Luna Foundation Guard (LFG) allegedly received 3,313 BTC before being transferred to the KuCoin and OKX exchanges.
KuCoin got 1,354 BTC in total, all of which were frozen right away. OKX, however, allegedly disregarded government demands. As a result, 1,959 BTC in total could not be blocked and were free to be transferred to other platforms.
Several people have expressed confusion about removing BTC from the LFG wallet because it goes against Kwon's earlier comments that he had used all of the BTC in the LFG reserves to support the TerraUSD Classic (USTC) peg.
Regardless of countless reports of various investigations in South Korea, Kwon asserted that neither he nor any officials had approached him before issuing his arrest order on September 14. It was reported that Kwon left Singapore after the arrest warrant was made public, requiring officials to contact Interpol for assistance.
Read: SWIFT partners with Chainlink for cross-chain crypto transfer project
Binance CEO: Regulatory clarity will help crypto adoption
Concerning the incidents facing Do Kwon and the theories surrounding them, it's easy to see the need for clear and detailed cryptocurrency regulations. This need was further voiced by the head of one of the most reputable cryptocurrencies, Bitcoin.
Changpeng Zhao, CEO of Binance, thinks that establishing clear standards can hasten the acceptance of cryptocurrencies.
Zhao stated in an interview with Yahoo Finance LIVE that establishing regulatory clarity will help to ease crypto adoption. He added that the presence of these regulations will push 95% of those who are not in crypto yet to embrace the unique currency.
In an opinion piece that was published on Yahoo Finance, Zhao explained that contrary to people's beliefs on how furthering crypto laws is against the principles of cryptocurrency and blockchain, he believes that a grounded regulatory environment is the only thing that can uphold innovation, that is crucial in the crypto space. He added that this lofty step demands trust building in the industry, which paves the way for stable growth.
Zhao responded that Binance is in contact with several authorities when questioned if it is currently in discussions to register with the Securities and Exchange Commission.
In contrast to the beliefs of some public officials, Zhao stated that he thinks it is pretty straightforward to categorize all cryptocurrencies as securities. He further pointed out numerous distinct kinds of cryptocurrencies and expressed that some are strikingly similar to fiat money, and others look like other asset forms.
Gary Gensler, the chairman of the Securities and Exchange Commission, has frequently urged cryptocurrency companies to register consciously with the organization, claiming that a significant number of cryptocurrencies are securities since tokens are used to make money.
According to Gensler, this reality indicates that many cryptocurrency mediators, such as exchanges and broker-dealers, are engaging in securities transactions and must register with the exchange in one way or another.
What are your thoughts on the recent action by South Korean prosecutors on Do Kwon? Do you think the crypto regulations suggested by Zhao would have stopped this incident? Please share your thoughts with us in the comments section.
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