South Korean cryptocurrency entrepreneur Do Kwon will be extradited to the United States from Montenegro over the collapse of two digital tokens – TerraUSD and Luna tokens.
For months, the US and South Korea have been seeking Kwon’s extradition, alleging that fraud led to the failure of the company behind the tokens, which sunk some $40bn (£31.7bn) from investors and rocked global crypto markets.
Montenegro does not have extradition treaties with the US or South Korea, so the matter had to be fought in the courts.
The decision marks an end to more than 18 months of rulings and reversals.
“The Minister of Justice, Bojan Bozovic, issued a decision approving the extradition of the accused, Kwon Do Hyung, to the United States of America,” the Ministry of Justice announced said in a statement
“It was concluded that the majority of the criteria prescribed by law favour the extradition request from the competent authorities of the United States of America,” the statement said.
It added that Kwon had consented to be extradited to both South Korea and the United States.
In February, US regulators charged Kwon and his company Terraform Labs with “orchestrating a multi-billion dollar crypto asset securities fraud”.
“We allege that Terraform and Do Kwon failed to provide the public with full, fair, and truthful disclosure as required for a host of crypto asset securities, most notably for Luna and TerraUSD,” US Securities and Exchange Commission (SEC) chairman Gary Gensler said in a statement at the time.
The US alleged that Kwon repeatedly claimed that the tokens would increase in value, and misled investors about the stability of TerraUSD.
Despite billions in investments, TerraUSD and Luna went into a death spiral in May 2022.
It triggered a sell-off in other major cryptocurrencies including Bitcoin.
In September 2022, Interpol issued a “red notice” warrant for Kwon’s arrest. He was in Singapore before his business crashed and fled to Serbia before being picked up in Montenegro.
Kwon was arrested in March 2023 as he tried to board a flight to Dubai at Podgorica Airport, in Montenegro’s capital.
In June 2023, he was sentenced to four months of jail in Montenegro having been found guilty of forging official documents.
The former finance officer of Terraform Labs, Hon Chang-joon, was extradited to South Korea in February, after serving four months in prison in Montenegro over fraud charges.
