Terraforms Labs CEO Do Kwon spent the last day of 2024 extradited to the United States. Reuters reports. In the US, Kwon is charged with “organizing a multi-billion dollar crypto-asset securities fraud using an algorithmic stablecoin and other crypto-asset-related securities.” The Terraforms co-founder has been detained in Montenegro since March 2023 when he tried to board a flight using a fake passport – six months after Interpol issues red notice warrant for his arrest.
South Korean company Terraforms Labs wiped out $40 billion from the cryptocurrency market when its stablecoins TerraUSD and Luna were less than stable and crashed in May 2022. Kwon had already left South Korea a month earlier.
The US announced its charges in February 2023. Securities and Exchange Commission (SEC) Chairman Gary Gensler stated:“We allege that Terraform and Do Kwon failed to provide the public with complete, fair and truthful information as required for numerous cryptoasset securities, most notably Luna and TerraUSD. We also allege they committed fraud by repeating false and misleading statements to bolster confidence before causing devastating losses to investors.” South Korea has made similar accusations.
Montenegro does not have extradition treaties with the United States or South Korea. The request has been pending in court for the past year and a half, with Montenegro's Justice Minister Bojan Bozovic ordering Kwon's extradition last week. Terraform Labs has applied for Chapter 11 Bankruptcy Protection in the USA in January last year.