Extended Stay in Montenegro: Awaiting Extradition
Terraform Labs co-founder Do Kwon, who had been facing extradition to the United States and South Korea, is now expected to extend his stay in Montenegro until February. This development comes following the conclusion of his four-month prison sentence in Montenegro, where he was incarcerated for using falsified travel documents.
Falsified Travel Documents and Four-Month Sentence
In March, Kwon was arrested in Montenegro on charges of using falsified travel documents, leading to a subsequent four-month prison sentence. The arrest had initially raised questions about whether he would be extradited to the U.S. or South Korea.
U.S. and South Korea’s Extradition Requests
According to a recent Bloomberg report on December 12, authorities from the U.S. and South Korea have requested Montenegrin officials to extend Kwon’s custody for an additional two months. The Wall Street Journal previously reported on December 7 that the U.S. would take custody of Kwon before South Korea, but both countries have pending extradition requests at the time of this publication.
Eight Criminal Charges Await in the United States
Should Kwon be extradited to the United States, he would be facing eight criminal charges, including commodities fraud, securities fraud, wire fraud, and conspiracy to defraud and engage in market manipulation. The U.S. Securities and Exchange Commission has also charged Kwon with “defrauding investors in crypto schemes,” adding another layer of legal complexity to his situation.
Terra’s Collapse: Catalyst for Crypto Market Downturn
The extended legal saga surrounding Kwon is closely tied to the collapse of Terra in May 2022. This event marked a significant turning point in the cryptocurrency market, triggering a widespread downturn. TerraUSD (UST) depegged from the U.S. dollar, and the repercussions were felt across the industry, leading to the bankruptcy of major firms such as Voyager Digital, BlockFi, Celsius Network, and FTX.
