Do Kwon Refutes Claims of $40M in Frozen Crypto

The Terraform Labs CEO has continued to push back claims made by local authorities in South Korea since Interpol’s wanted persons notice


Blockworks Exclusive Art by Axel Rangel


key takeaways

  • Local media repeatedly report Kwon’s assets have been frozen
  • Kwon labeled the news as “muscle flexing” in a tweet on Wednesday, despite on-chain evidence

Controversial crypto figure Do Kwon pushed back against reports Wednesday claiming prosecutors in South Korea had frozen tens of millions of dollars in crypto belonging to him.

Local media have placed the latest freeze at roughly 56.2 billion won ($39.9 million) in various digital assets including bitcoin, based on estimates from the Seoul Southern District Prosecutors’ Joint Financial Securities Crime Investigation Team.

Kwon has labeled the news as “muscle flexing.” The CEO’s exact whereabouts are currently unknown, and an Interpol red notice has been issued requesting his arrest. 

He has maintained he is not in hiding and has also rebuffed Interpol claims, noting he can be found coding in his living room — wherever that may be. 

The latest back-and-forth between local authorities and Kwon follows reports last month that South Korean authorities had requested local crypto exchanges OKX (previously known as OKEx) and KuCoin freeze a total of 3,313 bitcoin ($67.3 million) allegedly belonging to the CEO, a day after the red notice was issued.

“Once again, I don’t even use Kucoin and OkEx, have no time to trade, no funds have been frozen,” the CEO said in his tweet on Wednesday. I don’t know whose funds they’ve frozen, but good for them, hope they use it for good.”

Kwon took the opportunity to cast aspersions on the current political party in power in Seoul, implying they were responsible for jailing opposing politicians.

“It’s no surprise that crypto is most popular in countries that weaponize state institutions against their own people for political gain. Reap what you sow — revolutions start from within,” he tweeted.

The CEO, whose failed stablecoin project has been blamed for crypto’s recent turmoils and $40 billion in losses, is also wanted by local police along with former employees.

In September, a court issued the Seoul Southern District Prosecutor’s Office six arrest warrants for former employees, including Kwon and financial officer Han Mo, alleging they had breached securities and capital markets law.

On-chain analysis aligns with prosecutors’ allegations

Bitcoin transactions are pseudonymous, but the immutable record of the blockchain makes funds easy to trace.

On-chain analysis conducted by OXT Research appears to confirm the link between the frozen exchange assets and the Luna Foundation Guard (LFG), set up by Do Kwon ostensibly to defend the UST peg.

The LFG pointed to a wallet address controlling 313 BTC, in a Sept. 28 tweet, asserting that “LFG hasn’t created any new wallets or moved $BTC or other tokens held by LFG since May 2022.”

OXT Research disputes that.

Loading Tweet..

The “trail of bread crumbs” links the funding of the LFG’s publicly declared walled with a massive stash of bitcoins on the two exchanges.

“Since September 15, this sequence has distributed about $65mm worth of BTC as of the date of the respective deposits to Kucoin and OkEx,” OXT Research said on Twitter, adding, “My quick estimate of $65mm roughly corresponds with the values quoted in the Korean press last week.”

Loading Tweet..

If Do Kwon’s claims are true, and the Kucoin- and OKX-held assets are not connected to the LFG, then the question remains: Whose bitcoins were frozen?

Macauley Peterson contributed reporting.

Don’t miss the next big story – join our free daily newsletter.


Upcoming Events

Salt Lake City, UT

WED - FRI, OCTOBER 9 - 11, 2024

Pack your bags, anon — we’re heading west! Join us in the beautiful Salt Lake City for the third installment of Permissionless. Come for the alpha, stay for the fresh air. Permissionless III promises unforgettable panels, killer networking opportunities, and mountains […]

recent research

ao cover.jpg


Arweave recently launched the testnet for AO computer, a new messaging protocol that will sit atop a PoS network and aims to become a scalable global compute platform through parallel processing and modularity.


Crypto markets were largely the only ones open over a tense weekend, and they took a beating for it


Though some expect most public miners to survive the halving, the segment’s most vulnerable could fall victim to consolidations and defaults


The US spot bitcoin fund category has notched negative net flows over the course of a week just three times since coming to market in January


Elsewhere, rank-and-file employees move around and Binance’s head of legal in Europe departs


Plus, a Dragonfly partner shares his view on the crypto VC market, and a mining hardware firm raises $80 million


Plus, a Bored Ape burger restaurant closes, and Crypto: The Game presses on