Author: Turner Wright, CoinTelegraph; Translated by: Deng Tong, Jinse Finance

The U.S. Attorney's Office has brought an additional charge against Terraform Labs co-founder Do Kwon for conspiracy to launder money after his extradition from Montenegro to the U.S.

On January 2, the U.S. District Court for the Southern District of New York released an amended indictment, with U.S. Attorney Damian Williams accusing Kwon of conspiring to launder money with others.

According to U.S. prosecutors, the Terraform co-founder facilitated transactions exceeding $10,000 on the platform, "knowing that certain financial transactions involved properties representing proceeds of some form of illegal activity."

Do Kwon's amended indictment was released on January 2. Source: Courtlistener

The money laundering charges are part of the amended indictment, which were not initially included in the eight charges against Kwon in March 2023. Prosecutors filed the indictment under seal in May 2024, and the judge ordered it to be unsealed when Kwon appeared in court on January 2.

Kwon allegedly participated in the collapse of the Terra ecosystem in 2022; he was imprisoned in Montenegro in 2023 for using forged travel documents. U.S. and South Korean authorities filed competing petitions for the extradition of the Terraform co-founder, but Montenegrin authorities did not decide his legal status until December 2024, at which point Kwon was handed over to U.S. officials.

Trial or plea deal?

The Terraform co-founder appeared in court on January 2, pleading not guilty to all charges and agreeing to be detained. It is still unclear whether U.S. authorities will consider a plea deal or intend to proceed with a criminal trial.

Kwon's case is similar to that of former FTX CEO Sam "SBF" Bankman-Fried—another cryptocurrency executive who was subject to the jurisdiction of another country (the Bahamas) before being extradited to the U.S. In SBF's case, his lawyers were able to argue that the campaign finance charges added in the amended indictment should be dismissed because they were not part of the extradition request.

Bankman-Fried was later convicted of seven felonies and sentenced to 25 years in prison, but he has appealed.

Another key industry figure—former Binance CEO Changpeng Zhao—pleaded guilty to one charge and will serve four months in prison in 2024.