Terra's Do Kwon to be extradited to Korea: Montenegro court

Finance

Published: 08 Mar. 2024, 08:38 Updated: 08 Mar. 2024, 16:24

Terra's Do Kwon to be extradited to Korea: Montenegro court

Do Kwon, the cryptocurrency entrepreneur, who created the failed TerraUSD stablecoin, is taken to court in handcuffs, to face charges of forging official documents, in Podgorica, Montenegro, March 24, 2023. [REUTERS/YONHAP]

The failed crypto mogul Do Kwon will be extradited to Korea rather than the United States over the $40 billion collapse of the TerraUSD coin in 2022, said a Montenegrin high court on Thursday.

The Montenegrin appeals court said on Thursday that Kwon should be handed over to his home country, overturning the earlier decision.

Kwon, co-founder of Terraform Labs, is expected to be extradited to Korea after March 23 when he finishes serving his sentence, according to a report from CoinDesk, citing Kwon’s Montenegrin attorney Goran Rodic.

The ruling is a win for Kwon as penalties for white-collar crimes are lower in Korea than in the United States.

FTX co-founder Sam Bankman-Fried faces potentially decades in prison after he was convicted of fraud in New York in November. He was prosecuted over fraud and related crimes by the Manhattan U.S. attorney’s office, which also indicted Kwon on fraud charges.

Despite the extradition to Seoul, the Korean government could reach a deal to have Kwon tried in New York first if it argues that it has a stronger ability to seize Kwon’s assets around the world and agree to share them with Korea, according to Bloomberg.

The Montenegrin court ordered Kwon be sent to the United States last month. The court extradited Han Chang-joon, the former chief financial officer of Terraform Labs, to Korea in February.

Kwon and Han were arrested in Montenegro in March last year for traveling on a forged passport.

Kwon also faces a U.S. Securities and Exchange Commission (SEC) lawsuit over the plunge of his creations. The SEC suit will go to trial at the end of March.

TerraUSD was designed as a stablecoin, pegged to stable assets like the U.S. dollar. But holders of the coin and its sister coin Luna lost most of their assets after the stablecoin plunged far below its $1.

BY JIN MIN-JI [jin.minji@joongang.co.kr]