Nima Momeni, 38, and Lee, 43, knew each other, San Francisco Police Chief Bill Scott said at a news conference, but he declined to elaborate on their connection. Momeni was taken into custody on Thursday morning in Emeryville, a San Francisco suburb, and booked on suspicion of murder.

The stabbing death of Lee has shocked the tech industry, with friends and former colleagues mourning the demise of a brilliant and generous man. Police found Lee with stab wounds in the Rincon Hill neighbourhood of San Francisco at 2:30 am April 4. He died at a hospital.

San Francisco District Attorney Brooke Jenkins said in a statement that Momeni has been charged with murder in Lee's death and is expected to be arraigned Friday. Prosecutors will ask a judge to hold him without bail, she said.

On his LinkedIn profile, Momeni describes himself as an "IT Consultant/Entrepreneur" as well as the owner of a company called Expand IT. Business filings with the state list Momeni as the chief executive officer, secretary and chief financial officer of Expand IT INC, described as an information technology consulting business.

Criminal records show Momeni was charged with carrying a switchblade in 2011, a misdemeanour offence. The case was dismissed the following year after he took a plea.

Lee is known for creating the widely used mobile payment service Cash App while working as chief technology officer of the payment company Square, now known as Block. He was the chief product officer for the cryptocurrency firm MobileCoin at the time of his death.

Lee was raised in Missouri and had recently moved to Miami with his father, but was back in San Francisco for business when he was killed. Friends described him as adventurous and fearless, and a doting father to his two children.

"I acknowledge and understand how the loss of a young, vibrant leader and innovator has rocked our city and even beyond," Jenkins said at the news conference.

After Lee's killing, prominent tech leaders, including tech billionaire Elon Musk, took to Twitter to mourn Lee's death and blame San Francisco for what they called the city's lax attitude toward crime.

Musk tweeted at Jenkins, saying that crime in San Francisco is "horrific" and that even when attackers are caught, they are often immediately released.

"I must point out that reckless and irresponsible statements like those contained in Mr. Musk tweet that assumed incorrect circumstances about Mr. Lee's death serve to mislead the world in their perceptions of San Francisco," Jenkins said

Australian Associated Press