The Montenegrin Court of Appeal ruled on Thursday that Terraform Labs co-founder Do Kwon should be extradited to his native South Korea. The ruling upheld a previous ruling by the Podgorica High Court in April that rejected a request to extradite the crypto fugitive to the United States. A date for Kwon’s extradition to South Korea has not yet been set.
The August 1 ruling in Montenegro is the latest in a long-running legal battle for the disgraced cryptocurrency founder. After Montenegro’s High Court ruled in March to deport Kwon to South Korea, the country’s Supreme Court overturned the ruling and sent the case to a lower court in April.
“Since there was no appeal against the aforementioned decision, the decision of the High Court of Podgorica on the part of the Republic of Korea allowing extradition through an abbreviated procedure is legally binding,” the court said in a statement on Thursday.
Founded in 2018, Terraform Labs crashed the cryptocurrency industry, wiping out at least $40 billion in market value in May 2022. Earlier this year, Terraform Labs filed for Chapter 11 bankruptcy in Delaware after its own cryptocurrency crashed in 2022.
The United States and South Korea both requested Kwon's extradition from Montenegro for prosecution after he was arrested at a Montenegro airport with false travel documents.
The U.S. Securities and Exchange Commission (SEC) sued Kwon and Terraform in February 2023 for allegedly defrauding U.S. investors who purchased the digital assets TerraUSD and Luna. At the same time, Kwon was indicted in South Korea on charges of fraud and financial crimes related to the crash of TerraUSD and Luna in May 2022.
In a March statement, the U.S. Justice Department said it was continuing to pursue Kwon's extradition “in accordance with relevant international and bilateral agreements and Montenegrin law.”
Ultimately, it appears that the cryptocurrency fugitive will be extradited to Korea to stand trial.
Kwon was arrested in Montenegro in March 2023 after attempting to travel to Dubai with a fake passport. The Terraform Labs founder was sentenced to four months in prison but remained in custody until he was released on bail in March 2024.
To settle a civil securities fraud lawsuit, Kwon’s bankrupt company agreed to pay a fine of about $4.5 billion to the SEC. The deal also included a $204 million contribution from Kwon. Terraform Labs also agreed to scale back its operations. Last month, it announced a strategic sale as part of its ongoing Chapter 11 case.
