Montenegro court rules Do Kwon to be extradited to South Korea

Montenegro’s high court has ruled that Do Kwon, co-founder of Terraform Labs, will be extradited to South Korea to face fraud charges stemming from the collapse of the Terra ecosystem. The decision, announced on Thursday, overturns a previous ruling that favored his extradition to the United States. Kwon, who is currently serving time in Montenegro for passport fraud, had appealed the initial decision to extradite him to the U.S., citing legal process issues. The Montenegro Court of Appeals revoked his extradition to the U.S. on March 5.

The court’s ruling comes after South Korea’s National Police agency sought assistance from Interpol to secure Kwon’s extradition from Montenegro, emphasizing that South Korea had requested his extradition before the U.S. did. Kwon faces allegations of fraud related to the May 2022 crash of the algorithmic stablecoin TerraUSD, which led to a $45 billion loss in market capitalization. The decision to extradite Kwon to South Korea was influenced by factors such as the severity of the alleged crime, the location of the crime, and the timing of the extradition request.

The legal battle over Kwon’s extradition has been ongoing, with South Korea issuing an arrest warrant in September 2022, while U.S. authorities charged him in March 2023. Kwon’s defense team successfully argued for his extradition to South Korea on procedural grounds. Kwon had previously expressed a desire to be extradited to South Korea to be closer to his family. He will be transferred to South Korean authorities after completing his sentence for passport fraud in Montenegro.

The case of Do Kwon is part of a broader narrative of legal actions against crypto executives, as exemplified by the upcoming trial of former FTX CEO Sam Bankman-Fried for crypto fraud. Bankman-Fried’s extradition from the Bahamas to the U.S. was processed swiftly, with his sentencing scheduled for March 28, 2024. The Terraform Labs co-founder’s legal situation underscores the increasing scrutiny and regulatory actions facing the cryptocurrency industry following high-profile collapses and alleged fraudulent activities.