Seoul Prosecutor Is Freezing Millions in Crypto Assets Linked to Terra's Do Kwon

Last Sept. 18, Do Kwon, the man responsible for one of the greatest crypto meltdowns in history, posted a public message stating that he was not hiding from the law. This comes after US Securities and Exchange Commission authorities launched a financial crime investigation into the $40 billion investment loss caused by Terraform Labs' crash earlier this year.

Seoul Prosecutors Freeze Crypto Assets

Based on the most recent CNBC update on the matter, South Korean authorities have discovered $60 million in bitcoin linked to Do Kwon. Seoul officials confirmed to CNBC that they had ordered the freezing of multimillion cryptocurrency assets allegedly related to the founder of the now-defunct digital currencies.

Based on the report, Seoul's Southern District prosecutors ordered the crypto freeze and specifically requested it from digital coin platforms OKX and KuCoin. Some 3,103 bitcoin have been identified in the said requests, which amount to $62 million according to the latest crypto exchange trends.

Do Kwon, the co-founder of Terraform Labs, has been placed on Red Notice by the International Criminal Police Organization (Interpol). Since then, local law enforcement has been keeping a close eye on the alleged runaway cryptocurrency founder. A "Red Notice" requests that law enforcement agencies worldwide locate and transiently detain a suspect awaiting extradition, surrender, or other legal action.

Do Kwon is the founder and CEO of Terraform Labs, the parent company of the stablecoin terraUSD and its sister token luna. The coins were appraised at a staggering $60 billion prior to the massive crash that shattered the two digital coins. The sudden drop appeared out of nowhere, with no signs of gradual depreciation.

Crypto Researcher Slams Alleged Cashout

Seoul authorities did not provide any additional information or comments on the alleged crypto wallet freezing. They also did not explain how they associated the digital coin accounts with Do Kwon. However, a crypto analytics firm provided some useful information about the acquisition efforts.

Following a report from Bloomberg, researcher CryptoQuant thinks that on Sept. 15, a new wallet address thought to be affiliated with Do Kwon's bitcoin reserve, Luna Foundation Guard, was created. Following that, 3,310 Bitcoins in total were transferred from the wallet to KuCoin and OKX.

LFG responded to a tweet by saying that it had not created any new wallets or moved bitcoin or other digital currencies around since May 2022, criticizing the claims made by CryptoQuant. The bitcoin reserve even shared the address of its wallet to support its claims. But CryptoQuant refused to accept the LFG's details, claiming that what the LFG posted was the public version of the said wallet, implying the existence of an encrypted wallet hidden somewhere.

According to the same CNBC report, KuCoin, one of the mentioned cryptowallets in the incident, has confirmed that it has been coordinating with authorities but has not disclosed any further details.