Do Kwon Likely to Be Extradited to US

Do Kwon, the former CEO of Terraform Labs, found himself at the heart of the crisis that led to the near-total collapse of Terra and Luna. Despite fleeing South Korea, Kwon remained active on social media, notably Twitter, where he frequently posted content criticizing SBF and others, holding them responsible for the downfall of his platform. In a bold statement about a year ago, Kwon claimed that accusations against his platform were baseless, a view that was not widely shared by his community.

Capture in Montenegro: The Journey from Abu Dhabi

Kwon’s escape route took him through Abu Dhabi, but his freedom was short-lived. After months of evading authorities in Europe and possibly other locations, Montenegrin border officials detained him as he tried to enter Costa Rica. At the time of his capture, Kwon was using a counterfeit passport, which he claimed to be unaware of. This led to his four-month imprisonment.

The custody of Do Kwon sparked a diplomatic tug-of-war between the United States and South Korea, with both countries seeking his extradition to face trial. Recent reports, including one from the Wall Street Journal, indicate that Kwon will be extradited to the U.S. Montenegrin Justice Minister Andrej Milović has made this decision, although an official announcement is still pending.

“Today’s action not only holds the defendants accountable for their roles in Terra’s collapse, (and) once again highlights that we look to the economic realities of an offering, not the labels put on it. As alleged in our complaint, the Terraform ecosystem was neither decentralized nor finance. It was simply a fraud propped up by a so-called algorithmic “stablecoin” – the price of which was controlled by the defendants, not any code.”

Upon extradition to the U.S., Kwon will confront fraud charges filed by the SEC in February. The SEC’s case alleges that the Terraform ecosystem was a fraud, disguised as a decentralized financial system but actually controlled by Kwon and his associates. Importantly, being tried in the U.S. does not exempt Kwon from facing charges in South Korea. He could still be tried and sentenced in absentia in his home country.