SEOUL – A court in South Korea has issued an arrest warrant for Do Kwon, the founder of the Terraform Labs cryptocurrency ecosystem, whose US$40 billion (S$56 billion) wipeout earlier this year sparked a global crypto rout.

The court in Seoul issued a warrant for Do Kwon and five others, according to a text message from the prosecutor’s office.

A local newspaper earlier reported that the warrant was related to a violation of capital market rules.

The unravelling of the Terra platform in May included the collapse of the TerraUSD stablecoin, shaking faith in the digital-asset sector, which has yet to recover much of the losses. BLOOMBERG