Key Insights:
- Do Kwon accuses Montenegrin courts of bizarre interpretations in his extradition case.
- Legal battles continue as Montenegrin courts decide to extradite Terraform Labs’ co-founder.
- U.S. and South Korea both seek Do Kwon’s extradition over Terra’s 2022 collapse.
In Montenegro, Terraform Labs co-founder Do Kwon’s legal troubles show no signs of abating. Recently, his attorneys lodged an appeal against a decision by the High Court of Podgorica, which earlier confirmed the prerequisites for Kwon’s extradition to the U.S. or South Korea. Both nations seek to prosecute him over allegations tied to the financial disaster of Terra, a cryptocurrency platform he helped to establish.
TERRA FOUNDER DO KWON FIGHTS EXTRADITION AMID LEGAL SAGA
– Do Kwon, Terraform Labs co-founder, initiates a new appeal in the Montenegrin legal battle, criticizing the court’s “bizarre” interpretations.
– Kwon’s legal team filed the appeal against the High Court of Podgorica’s… https://t.co/TbtgWuu9I2 pic.twitter.com/BASrWNGI5M
— BSCN (@BSCNews) April 24, 2024
In their appeal, Kwon’s legal representatives criticized the Montenegrin courts for what they described as unusual interpretations of international legal assistance statutes. These assertions came to light through statements published by Vijesti, a local news outlet. Moreover, the legal team argued that the High Court, alongside the Supreme Court, favored these interpretations to align with the desires of the Justice Minister, thereby impacting the fairness of Kwon’s legal proceedings.
The backdrop of this legal saga extends to Terra’s catastrophic failure in 2022, which disrupted the cryptocurrency market and led to substantial investor losses. At the core of the controversy is TerraUSD, an algorithmic stablecoin designed by Kwon’s company, which lost its peg to the dollar not through asset backing but via trading incentives.
Adding to the complexity, last month, an appellate court annulled a previous ruling that approved Kwon’s extradition to South Korea, citing serious procedural violations. This decision necessitated a retrial where his extradition was once again sanctioned.
Kwon had earlier managed to overturn a separate extradition ruling to the U.S., emphasizing that South Korean authorities had initially requested his extradition, not the U.S. This legal maneuvering in Montenegro continues even as Kwon faces mounting legal challenges in other jurisdictions. Just this month, in Manhattan, a jury found Kwon and Terraform Labs guilty of fraud as per charges levied by the Securities and Exchange Commission, which accused them of making false claims about Terra’s viability and operations.
Significantly, the legal discourse in Montenegro is set against a backdrop of intense scrutiny from international regulators. These authorities have highlighted misrepresentations by Kwon and his firm, including undisclosed support from a key investor during a previous de-pegging incident involving TerraClassicUSD in 2021. Additionally, they contend that Terraform Labs exaggerated the scope of its integration with a South Korean payments app, Chai.
As the legal battle waged on, Do Kwon remained detained in Montenegro after his arrest at Podgorica Airport last year, where he and Terra’s former CFO, Han Chang-joon, were caught with counterfeit passports. While Han has since been extradited to South Korea, Kwon’s fate hangs in the balance as he contests the legal interpretations that could determine his future.