Do Kwon, the disgraced co-founder of Terraform Labs, faced another legal setback as Montenegro’s Constitutional Court unanimously rejected his appeal. Kwon had challenged the authority deciding his extradition after his arrest in March 2023 for traveling with falsified documents.
With this decision, the power to decide Kwon’s fate now rests with Montenegro’s Minister of Justice. Both the United States and South Korea have requested his extradition. Kwon faces serious criminal charges, including securities fraud and wire fraud, for his role in the 2022 collapse of TerraUSD and Luna, which wiped out billions of dollars in investor value.
If extradited to the U.S., Kwon could face multiple lawsuits and potential imprisonment. Meanwhile, South Korea’s attempts to prosecute him may be delayed. As the legal drama unfolds, Kwon’s time as a fugitive appears to be nearing its end.
Do Kwon Faces Global Legal Actions
Do Kwon, co-founder of Terraform Labs, has been at the center of major legal actions following the collapse of TerraUSD (UST) and Luna in 2022, which caused massive investor losses.
U.S. SEC Actions:
• In February 2023, the SEC charged Kwon and Terraform Labs with multi-billion-dollar crypto fraud.
• By April 2024, they were found liable for securities fraud, agreeing to a record $4.5 billion settlement.
Criminal Charges and Arrest:
• Kwon was arrested in Montenegro in March 2023 while using falsified documents.
• Both the U.S. and South Korea are seeking his extradition, but a decision is still pending.
Financial Penalties:
• The $4.5 billion SEC settlement marks one of the largest civil penalties ever, though collection remains uncertain due to Terraform Labs’ bankruptcy.
Kwon’s case highlights ongoing global efforts to hold crypto leaders accountable for fraud and financial crimes.