Do Kwon Released from Montenegrin Prison; Terraform Labs Trial Begins

Do Kwon Released from Montenegrin Prison
Do Kwon has been released from prison in Montenegro, where he was held as both the U.S. and South Korea sought his extradition regarding charges linked to the $40 billion collapse of the Terra ecosystem in 2022.

Terraform Labs co-founder Do Kwon has been freed from detention in Montenegro while the country’s Supreme Court deliberates on extradition requests from both the U.S. and South Korea.

Both nations are seeking Kwon’s extradition to face criminal charges, including fraud, related to the $40 billion collapse of the Terra ecosystem in May 2022. Following the Terra crisis, Kwon evaded authorities for months before being apprehended in Montenegro while allegedly attempting to use counterfeit Costa Rican travel documents en route to Dubai.

Initially sentenced to four months for this offense, Do Kwon remained incarcerated in Montenegro until his recent release on Saturday. Reports from local media indicate that Kwon has been placed in a facility for foreign nationals and his genuine passport has been confiscated to prevent him from departing the country.

Do Kwon is expected to petition the court for permission to remain in Montenegro until a decision on his extradition is reached, according to local media sources.

During his detention, Do Kwon and his legal team contested extradition attempts by challenging court rulings. Initially, his extradition to South Korea seemed inevitable after an appellate court upheld a lower court’s decision to return him to his home country to face charges.

However, this decision was overturned last week when Montenegro’s chief prosecutor intervened, prompting the Supreme Court to review and suspend Kwon’s extradition. The Supreme Court is currently deliberating on the two opposing extradition requests, with no specified timeline for a decision.

Civil fraud trial commences in New York

Kwon’s prolonged stay in Montenegro has not halted legal proceedings against him.

In New York, a civil fraud trial initiated by the U.S. Securities and Exchange Commission (SEC) against Kwon and Terraform Labs began on Monday. The SEC alleges that Kwon and Terraform Labs deceived investors by providing false information about the stability of Terra, their “algorithmic stablecoin,” and misrepresented the integration of the Terra blockchain into a Korean mobile payment application.

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