By Geoffrey Smith
Investing.com -- Do Kwon, the fugitive founder of the Terra/Luna stablecoin network whose collapse triggered last year's rout in cryptocurrencies, has reportedly been arrested in the Balkan state of Montenegro.
The country's Interior Minister, Filip Adzic, tweeted on Thursday that Montenegrin police had arrested Kwon at Podgorica airport, where he was apparently trying to leave the country on forged documents.
Kwon, a native of South Korea, has been on the run since Interpol issued an international arrest warrant for him in September at the request of prosecutors in his homeland. Authorities in Singapore, from where he had run the organization behind the Terra/Luna stablecoin, said he was no longer on the island state. Various Internet rumors suggested he had been laying low in Serbia, which does not have an extradition agreement with South Korea.
Terra/Luna, an algorithmic stablecoin that Kwon had touted as being able to regulate its own circulation in order to preserve parity with the dollar, collapsed suddenly last April, triggering billions of dollars in losses for various crypto investment firms.
Its initial victims included Celsius Network and Three Arrows Capital, but the episode also led indirectly to the collapse of crypto exchange FTX in November. FTX expropriated its customers' deposits in order to cover up losses made on Terra/Luna earlier in the year by its affiliated hedge fund, Alameda Research.