Montenegro Court Halts Extradition of Crypto Mogul Do Kwon
A court in Montenegro has paused the extradition of Terraform Labs co-founder Do Kwon to the US or South Korea, citing procedural issues and sparking market reactions.
In a surprising legal twist, a Montenegro court has temporarily blocked the extradition of Do Kwon, co-founder of Terraform Labs, to either the United States or South Korea, throwing a wrench in the ongoing legal saga. The decision, influenced by procedural concerns and lack of clarity, has sparked a fresh wave of uncertainty in the crypto world.
The Podgorica-based Appeals Court’s ruling is a response to an appeal by Do Kwon’s defense, leading to the case’s referral back to the Supreme Court for further consideration. This development comes after a previous court ruling last month approved his extradition, but left the final decision to the Montenegrin Minister of Justice.
Kwon, a key figure in the crypto industry, is at the center of a major legal battle following the collapse of TerraUSD, an algorithmic stablecoin, in May 2022. This event significantly contributed to a harsh bear market in the crypto sector, leading several crypto projects with ties to Terra to declare bankruptcy. The collapse of Terra and its native cryptocurrency, LUNA, once among the top digital assets by market cap, marked a turning point in the crypto world.
Authorities in both the United States and South Korea have indicted Kwon on charges, including violating capital markets rules. The gravity of these allegations is highlighted by statements from Dan Sunghan of Seoul’s financial crime investigation bureau, who indicated in a BNN Bloomberg interview that Kwon could face over four decades of imprisonment in both countries. Additionally, the U.S. Securities and Exchange Commission charged him early this year with orchestrating a “multi-billion dollar crypto asset securities fraud.”
The legal battle has had a ripple effect on the market, particularly impacting the LUNA Classic token (LUNC), the original Terra LUNA coin that emerged post-collapse. Following the initial news of Kwon’s potential extradition, LUNC experienced a significant drop of over 30%. However, it has since rebounded, trading at $0.00016717, reflecting a 120% gain over the past 30 days and 21% year-to-date.
Kwon, alongside Han Chang-Joon, former finance officer of Terraform Labs, was arrested earlier this year in Montenegro while attempting to travel on a fake passport. Throughout the trial, Kwon expressed a preference for extradition to South Korea, a sentiment that was echoed in the court’s press release.
As the case returns to the High Court for reconsideration, the fate of Do Kwon’s extradition remains in limbo. The Montenegrin Minister of Justice holds the power to decide his ultimate destination, considering arguments from both defense and prosecution. The outcome of this legal matter will likely have significant implications for the future trend of LUNC and the broader crypto market in the coming months.
