S. Korean crypto founder Do Kwon, the person behind TerraUSD, to be extradited to US from Montenegro – Firstpost

South Korean cryptocurrency entrepreneur Do Kwon can be extradited to the US following a Montenegrin courtroom determination over his alleged position within the collapse of two digital tokens, TerraUSD and Luna, which worn out $40 billion in investor funds.

Kwon’s extradition follows the February extradition of Terraform Labs’ former finance officer, Hon Chang-joon, to South Korea. Hon had additionally served 4 months in Montenegro for fraud-related prices, based on BBC.

Interpol had issued a crimson discover for Kwon’s arrest in September 2022, signalling worldwide regulation enforcement to find and detain him.

His extradition to the US marks a major step in holding him accountable for some of the high-profile monetary collapses in cryptocurrency historical past.

Who Is Do Kwon?

Do Kwon, the founding father of Terraform Labs, gained prominence as a key determine within the cryptocurrency world together with his improvement of the Terra blockchain platform and its related stablecoin, TerraUSD, and token, Luna.

At its peak, the Terra ecosystem was valued at billions of {dollars}, attracting vital world investments.

Nonetheless, the collapse of TerraUSD and Luna in Might 2022 triggered one of many largest monetary failures in cryptocurrency historical past, resulting in widespread investor losses and a sell-off in main cryptocurrencies like Bitcoin.

After the crash, Kwon fled Singapore and later travelled to Serbia earlier than being apprehended in Montenegro in March 2023 whereas trying to board a flight to Dubai utilizing solid paperwork.

What are the allegations towards him?

US and South Korean authorities accuse Kwon of orchestrating a multibillion-dollar securities fraud tied to Terraform Labs. The US Securities and Change Fee (SEC) alleges Kwon made deceptive claims in regards to the stability of TerraUSD, a so-called stablecoin, and misrepresented the potential worth of Luna to buyers.

“We allege that Terraform and Do Kwon failed to supply the general public with full, truthful, and truthful disclosure as required for a bunch of crypto asset securities, most notably for Luna and TerraUSD,” SEC Chairman Gary Gensler stated in February when prices have been introduced.

Kwon’s firm promised stability for TerraUSD, pegged to the US greenback, however the tokens entered a “dying spiral” in 2022, destabilising world crypto markets and eroding investor confidence.

Extradition determination and authorized battles

Montenegro’s Justice Minister Bojan Bozovic introduced the choice to extradite Kwon to the US, citing authorized standards favouring the American request. The nation, which has no formal extradition treaties with the US or South Korea, required the matter to be resolved via in depth authorized proceedings over 18 months.

Kwon had consented to extradition to each international locations, however Montenegro opted to satisfy the US request. He was beforehand sentenced to 4 months in Montenegrin jail for utilizing solid paperwork.