South Korean authorities say they believe Do Kwon, the failed cryptocurrency boss behind the $40bn (£32.7bn) collapse of the terraUSD and Luna tokens, is hiding in Serbia.

The Seoul Southern District Prosecutors' Office said it would work with Serbia to detain him.

Mr Kwon, 31, was charged with fraud and breaches of capital markets law after the tokens imploded in May.

In September Interpol issued an international warrant for his arrest.

The following month, South Korean prosecutors said he had travelled via Dubai to an unknown country after leaving Singapore, where his company Terraform had its headquarters.

The Interpol "Red Notice" is a request to law enforcement worldwide to locate and provisionally arrest a person pending extradition, surrender, or similar legal action.

South Korea and Serbia do not have an extradition treaty but in the past both have agreed to requests under the European Convention on Extradition.

Mr Kwon has previously denied that he is in hiding, but has not revealed his whereabouts.

"I am not 'on the run' or anything similar - for any government agency that has shown interest to communicate, we are in full cooperation and we don't have anything to hide," he tweeted in September.

Prosecutors have also issued arrest warrants for five other people - who have not been named - linked to the so-called stablecoin Terra and its sister token Luna.

Stablecoins are designed to have a relatively fixed price and are usually pegged to a real-world commodity or currency - but Terra's value collapsed during this year's wider cryptocurrency crash.

The Terra Luna system collapsed in May, with the price of both tokens plummeting to near zero, and the fallout hitting the wider crypto-market.

From a $116 high in April, a Terra coin is now worth less than $0.0002.

Globally, investors in the two coins lost an estimated $42bn, according to blockchain analytics firm Elliptic.

Some investors lost their life savings, and South Korean authorities have opened several criminal probes into the crash.

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