Terra founder Do Kwon will be extradited to South Korea

The US authorities also sought the extradition of the businessman for trial in their jurisdiction

02.08.2024 - 09:45

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3 min

What’s new? Do Kwon, the founder of Terraform Labs (TFL), the company that developed the Terra blockchain, the UST stablecoin, and the LUNA token, will be handed over to the South Korean authorities following a court ruling in Montenegro. Thus, the appellate court upheld the decision of the highest court on the priority of Korea’s request for extradition of the businessman over the request of the United States.

Material by Bloomberg

What else is known? Kwon will face charges in Korea related to the collapse of UST and LUNA in May 2022, which led to multi-billion dollar losses for investors around the world. The US had also sought extradition for proceedings in its jurisdiction, but Korea was the first to file a request, which explains the Montenegro court’s decision.

Kwon was arrested in Montenegro in March 2023 while trying to fly to Dubai on a fake passport. At that time, he had already been on the run for several months and was listed in the Interpol database. He received four months in prison in Montenegro for forging documents, and after his release, he was awaiting a court decision on extradition to one of the two countries.

On July 19, a crypto investor protection law went into effect in Korea to combat fraud and market manipulation. Work on it began shortly after the Terra crash. Under this law, if the amount of damage exceeds 5 billion Korean won, violators face life imprisonment.

South Korea accused Kwon of fraud, bribery, and market manipulation.

Terraform Labs to sell four subsidiaries to cover SEC fine

TFL will pay the regulator $4,5 billion as part of the settlement agreement

Earlier in the US, a jury found Kwon and TFL guilty of defrauding investors by misrepresenting the stability of UST. Kwon and TFL have since reached an agreement with the US Securities and Exchange Commission (SEC) to settle the fraud charges. Under this agreement, the defendants will pay over $4,5 billion in fines.

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