Do Kwon, the founder behind the TerraUSD and Luna collapse, is set to be extradited to the United States. Montenegro’s Minister of Justice, Bojan Božović, signed the extradition order after the country’s Supreme Court confirmed that all legal conditions had been met. 

This move prioritizes the U.S. request over South Korea’s, effectively blocking the latter’s attempt to prosecute Kwon on its soil.

Legal grounds for extradition

Montenegro’s decision comes after carefully considering the gravity of Kwon’s alleged crimes and the sequence of extradition requests. The country’s Ministry of Justice stated that most legal criteria favor the U.S. request, emphasizing the severity of Kwon’s charges in the United States. This has led to dismissing South Korea’s request, which had hoped to bring Kwon to trial for fraud and illegal fundraising.

The fall of TerraUSD and luna

Kwon’s rise to prominence came with the creation of TerraUSD, a stablecoin meant to maintain a $1 value. Unlike traditional stablecoins, TerraUSD was tied to Luna, another cryptocurrency, using a mechanism designed to keep its value stable. However, when TerraUSD’s peg faltered in May 2022, the ensuing panic triggered the collapse of both assets. Once worth over $100, Luna rapidly lost its value, and billions in Bitcoin reserves were used in an unsuccessful attempt to stabilize the situation. The resulting fallout wiped out $40 billion, severely impacting the crypto market.

Kwon’s arrest and extradition

Following the collapse of TerraUSD and Luna, Kwon became a fugitive. After months of evading capture, he was arrested in Podgorica, Montenegro, on March 23, 2023, while attempting to board a private jet using forged passports. Kwon and Terraform Labs’ former CFO, Han Chang-joon, were detained in an international effort to locate him. While Han was eventually extradited to South Korea, Kwon’s extradition has now been confirmed to the United States.

Kwon’s extradition underscores the global reach of financial crimes in the cryptocurrency world, as U.S. authorities aim to hold him accountable for the massive losses his schemes caused. His trial is expected to shed light on the fraudulent practices that led to the downfall of TerraUSD and Luna.

The post Terra Luna Founder Do Kwon to Be Extradited to the United States first appeared on Coinfea.