Montenegro Greenlights Do Kwon’s Extradition to the United States for Legal Proceedings

On December 27, Montenegro announced its decision to extradite South Korean cryptocurrency entrepreneur Do Kwon to the United States (US).

This resolution concludes months of legal conflicts between the U.S. and South Korea, both of which sought Kwon’s extradition related to the $60 billion downfall of the Terra-Luna blockchain.

Reasons Behind Montenegro’s Preference for the U.S. in the Do Kwon Extradition Case

Once celebrated as an innovative blockchain initiative, Terra collapsed in 2022.

The failure resulted in billions of dollars in losses and led to the bankruptcy of significant firms such as Three Arrows Capital, BlockFi, and FTX.

Steady lads, deploying…to the U.S.
Montenegro’s Justice Minister has approved the extradition of Do Kwon to the U.S.
The Terraform Labs founder will face charges over the $40B crypto collapse. pic.twitter.com/W3K82fXy09

— Satoshi Club (@esatoshiclub) December 27, 2024

Investigators globally began examining Kwon’s involvement in the disastrous aftermath, leaving investors in shock and eroding confidence in the cryptocurrency industry.

After the Terra-Luna collapse, Kwon evaded law enforcement, even as Interpol issued a Red Notice for him. He initially escaped to Serbia and subsequently relocated to Montenegro.

In March 2023, Kwon and former Terraform Labs finance officer Han Chang-joon were apprehended at Podgorica Airport while trying to board a private flight to Dubai with counterfeit Costa Rican travel documents.

Following their arrest, Kwon and Han spent four months in a Montenegrin prison while U.S. and South Korean prosecutors competed for extradition rights.

Numerous reversals occurred in the legal proceedings in Montenegro. Kwon’s legal team, led by Balkan attorney Goran Rodić, contested each ruling.

Earlier this week, Montenegro’s Constitutional Court dismissed an appeal from Kwon’s lawyers, paving the way for the Justice Ministry’s decision.

The appeal contested a September ruling by the Supreme Court, which determined that the conditions for his extradition to both South Korea and the United States had been satisfied.

Justice Minister Bojan Bozovic made the conclusive decision, stating that the U.S. request would take priority.

“The majority of the criteria prescribed by law favor the extradition request from the competent authorities of the United States of America,” the Justice Ministry indicated.

This decision also denied South Korea’s request for Kwon’s extradition. In February, Montenegro deported Kwon’s business partner, known only as J.C.H., to South Korea.

The Transformation of Do Kwon: From Crypto Innovator to Fugitive

Earlier this year, Terraform Labs consented to cease operations and pay the SEC a historic $4.47 billion fine. U.S. prosecutors are pursuing further criminal charges, which could lead to severe penalties.

In South Korea, if found guilty of breaching financial regulations, Kwon could face a prison sentence of up to 40 years. The nation continues to advocate for his extradition.

Terraform Labs created TerraUSD, a stablecoin linked to assets such as the U.S. dollar and Luna, its counterpart token.

The tokens garnered substantial investments and media coverage. South Korean media even referred to Kwon as a “genius.”

However, in May 2022, both tokens fell into a financial “death spiral,” causing significant losses for investors and leading to accusations against Terraform Labs of operating a Ponzi scheme.

Following its collapse in January 2023, Terraform Labs sought U.S. bankruptcy protection, which was succeeded by numerous legal challenges.

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