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Since the collapse of LUNA and UST in May, South Korean prosecutors have been working on this case.
The South Korean prosecutors in charge of the ongoing Terraform Labs investigation have made the first arrest in connection with the case. As reported by local news media, JTBC, the arrested individual is named Yu (full name withheld as is customary with Korean investigations), and he occupies a pivotal position at Terraform Labs.
The report shows Yu is the head of general business operations at Terraform Labs, and he was directly in charge of trading activities for the collapse blockchain startup. Yu was arrested on grounds that he manipulated the prices of cryptocurrencies that were traded by Terraform Labs, in violation of the Capital Markets Act of Korea.
The South Korean prosecutors ticked this arrest as a big milestone in the case it has against Terraform Labs as Yu is one of the 6 people it has previously issued an arrest warrant. As reported by JTBC, the prosecutors are also planning to issue a bench warrant for Yu to show how important it is for them to keep him under close watch.
A bench warrant is an authorization that is used to keep a suspect in custody until trial commences. Bench warrants are often requested when there is a high probability that the suspect will abscond upon release.
Since the collapse of LUNA and UST in May, South Korean prosecutors have been looking for people to hold accountable. The $40 billion wiped away from investors has stirred a number of questions, most of which the prosecutors are seeking answers to. In their quest, at least two series of exchange invasions but the arrest of Yu comes off as the first it will be making.
South Korea Prosecutors and the Hunt for Do Kwon
Despite being responsible for the losses suffered by many retail and institutional investors, Do Kwon has made attempts to correct his mistakes by forking a new token that was distributed to holders of LUNA and UST based on snapshots taken at periods before their crash.
One striking thing is that he has been making contributions to the community while hiding from authorities. He has claimed he is not hiding, yet authorities are unable to put a pin on his location. In the desperate hunt for the embattled developer, Interpol has issued a Red Notice for his arrest, making him one of the most wanted humans alive.
The South Korean prosecutors have taken the strategy to fish him out to a new level by asking him to return his passport in the next 14 days. Failure to return the passport as requested can land him in even more trouble as he risks losing the passport with the hopes of reapplying very slim.