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Breaking: Do Kwon Faces Extradition to the United States
- After four months imprisonment, Do Kwon will most likely be extradited to the United States to face charges related to the TerraUSD collapse.
- Kwon will be hit with eight charges in the U.S., including securities and wire fraud.
- The USD $40-billion collapse of Terraform Labs still haunts the crypto industry to this day.
“Semi-disgraced” co-founder of Terraform Labs, Do Kwon, is being extradited to the United States. The software engineer had long been waiting to hear whether Montenegrin authorities planned to grant the United States or the South Korean government’s request for extradition. The news comes after Kwon was arrested in Montenegro earlier this year and sentenced to several months in prison for using a fraudulent passport.
Kwon Set to Face Eight Charges in the United States
The Montenegrin Justice Minister, Andrej Milovic, came to a decision today, the WSJ exclusively reported, that the nation would ship Do Kwon off to the United States rather than his hometown of South Korea. It’s worth noting that the announcement has not been made official and Kwon can still appeal any decisions made.
If the extradition is successful, Kwon will face up to eight charges in the U.S. and a significant period of jail time for his involvement in the downfall of Terraform Labs and the de-pegging of popular stablecoin TerraUSD (UST).
Allegations include securities fraud, commodities fraud, wire fraud and engagement in market manipulation. The Securities and Exchange Commission wants a piece of Kwon too after charging him with “defrauding investors in crypto schemes” in early 2023.
UST Collapse Still Shaping Crypto Industry
The collapse of Terraform Labs was over a year ago (May 2022), and yet, the aftershock of the calamity can still be felt in the blockchain sector. TerraUSD, at the time an extremely popular stablecoin, de-pegged from the U.S. dollar, eventually falling to zero. This catastrophe wiped some USD $40 billion (AUD $60 billion) from the industry, forever scarring investors, traders and institutions.
This event, followed by the equally disastrous downfall of FTX, is still clearly affecting retail investors who have taken a back seat during crypto’s late 2023 resurgence. How long it takes before consumer confidence becomes restored in the safety of digital assets is anybody’s guess, but the wounds Kwon and SBF left behind still need some more healing.
Author
Ben Knight
Ben Knight is a writer and editor from Melbourne with a passion for all things music and finance. He enjoys turning complex topics – especially the technical details of cryptocurrency – into digestible bites that anybody can understand. He acquired his Master’s in Writing, Editing and Publishing from RMIT in 2019 and has run his own creative writing business ever since.
