The arbitrage story definitely seems bogus. People have been aware of difference in bitcoin price across Asia since like the beginning of bitcoin - I don't think it is any huge billion $ opportunity.
Now Tether on the other hand.. I would not be surprised if that has a lot to do with it.
I was running an arbitrage bot well before he claims to have started arbitrage and even back then, it was competitive enough that there weren't tons of money to be made, especially considering all the risks and costs involved. In those days, a relatively common scam involved setting up an investment scheme that promised high returns thanks to "arbitrage trading" (but which was really just a ponzi scheme). I wouldn't be surprised if he was involved in something like that.
Now Tether on the other hand.. I would not be surprised if that has a lot to do with it.