Sources from Reuters on December 31, 2024, report that Do Kwon, co-founder of Terraform Labs, has been extradited from Montenegro to the U.S. Mr. Kwon is facing allegations of defrauding investors regarding the stability of TerraUSD, a 'stablecoin' that he claimed maintained a stable value of 1 U.S. dollar.
The incident occurred after Kwon was arrested in March 2023 while trying to leave Montenegro. The Montenegrin authorities handed Kwon over to U.S. law enforcement and the Federal Bureau of Investigation (FBI) at Podgorica Airport. It is reported that Kwon continues to deny any wrongdoing.
Notably, TerraUSD and another 'altcoin' called Luna collapsed in May 2022, leading to a shock in the cryptocurrency market and causing losses of around $40 billion. This incident prompted the U.S. Securities and Exchange Commission (SEC) to sue Terraform Labs and Kwon in February 2023.
Kwon is also wanted in his home country of South Korea. Last week, the Montenegrin Minister of Justice, Bojan Bozovic, ordered Kwon's extradition to the U.S. after the Supreme Court ruled that all legal conditions had been met. Kwon's lawyers have filed an appeal against this decision to the Constitutional Court.
Stablecoins like TerraUSD are digital assets aimed at maintaining stable value. They are often pegged to currencies to minimize volatility compared to other coins and cryptocurrencies.
This latest development once again highlights the complex and risky nature of the crypto market, while also emphasizing the legal issues that altcoin founders may face.
