TL;DR
- Montenegro’s Minister of Justice has approved the extradition of Do Kwon, co-founder of Terraform Labs, to the U.S., ending a prolonged legal dispute.
- The collapse of TerraUSD in 2022 led to significant financial failures and loss of trust in the crypto market, prompting global investigations into Kwon’s role.
- Kwon was arrested in Montenegro in March 2023 with fraudulent travel documents, and his extradition to the U.S. has now been authorized.
Montenegro’s Minister of Justice, Bojan Božović, has authorized the extradition of Do Kwon, the South Korean entrepreneur and co-founder of Terraform Labs, to the United States. This decision marks the end of a prolonged legal dispute related to Kwon’s role in the collapse of Terraform Labs.
The U.S. and South Korea have been actively seeking Kwon’s extradition due to his involvement in the disastrous $60 billion downfall of the TerraUSD and LUNA tokens.
The Collapse and Its Aftermath
The collapse of TerraUSD in 2022 triggered a wave of financial failures, including the bankruptcy of major firms like Three Arrows Capital, BlockFi, and FTX. After the collapse, global authorities started looking into Kwon’s involvement, and the huge financial losses caused many to lose trust in the crypto market.
Despite an Interpol Red Notice for his arrest, Kwon managed to evade capture, initially seeking refuge in Serbia before relocating to Montenegro.
Arrest and Legal Proceedings
Authorities arrested Kwon and former Terraform Labs Finance Officer Han Chang-joon at Podgorica Airport in March 2023 while they were attempting to board a private flight to Dubai with fraudulent Costa Rican travel documents.
Legal proceedings in Montenegro saw several reversals, with Kwon’s defense team, headed by Balkan attorney Goran Rodić, challenging each ruling. Earlier this week, Montenegro’s Constitutional Court dismissed an appeal filed by Kwon’s lawyers, paving the way for the Justice Ministry’s decision to move forward.
Extradition Decision
“It was concluded that most of the criteria provided for by law support the extradition request of the competent authorities of the United States of America,” the Ministry of Justice stated. The ruling also dismissed South Korea’s extradition request for Kwon. In February, Montenegro deported Kwon’s business partner, referred to only as J.C.H., to South Korea.
Future Implications
Earlier this year, Terraform Labs encountered a major issue, agreeing to pay a $4.47 billion fine to the U.S. SEC and stopping its operations. At the same time, U.S. prosecutors are working on additional criminal charges against the company, which could lead to serious consequences for those involved.
South Korea remains steadfast in its pursuit of Kwon’s extradition, aiming to hold him accountable for alleged financial law violations. If convicted, Kwon could face a prison sentence of up to 40 years under South Korean law.
