US DOJ appeals Montenegro court’s extradition verdict favoring Do Kwon’s return to South Korea

U.S. prosecutors have declared their intention to appeal a recent decision by a Montenegrin high court regarding the extradition of Do Kwon, the former CEO of Terraform Labs, to South Korea.

The development is part of an ongoing legal saga involving multiple jurisdictions, including South Korea and the U.S., both of which have filed extradition requests for Kwon.

According to a report by Bloomberg on March 7, the Department of Justice (DOJ) of the U.S. is pursuing Kwon’s extradition in line with “relevant international and bilateral agreements and Montenegrin law.” The DOJ also expressed appreciation for the cooperation of Montenegrin authorities in adhering to the rule of law.

The legal battle over Kwon’s extradition reached a pivotal moment on Feb. 21, when the High Court in Podgorica ruled in favor of sending Kwon to the United States. However, this decision was overturned two weeks later by the Montenegro Appeals Court due to “significant violations of the provisions of criminal procedure.” This shift in the court’s stance realigns Kwon’s potential extradition path back toward South Korea.

The U.S. case against Kwon involves eight charges, including allegations of fraud and market manipulation related to the $40 billion collapse of the Terra ecosystem. South Korea has also levied charges against Kwon, including fraud and violations of capital markets law. Kwon’s legal team has expressed a preference for his extradition to South Korea, citing proximity to his family and a potential 40-year prison sentence.

This legal development coincides with another high-profile case in the United States involving Sam Bankman-Fried, the co-founder of FTX, who faces potentially decades in prison following a fraud conviction in New York. The Manhattan U.S. attorney’s office, which is also pursuing charges against Kwon, prosecuted Bankman-Fried.

Kwon was apprehended in March 2023 by Montenegrin authorities for traveling with a counterfeit Costa Rican passport, following an arrest warrant issued by South Korean prosecutors in September 2022. Since his arrest, Kwon has spent time in prison over the passport incident and was later transferred to extradition custody.

In related news, the Terra Classic community is actively working on initiatives to recover from the collapse of TerraUSD (UST) in May 2022. Efforts include implementing token-burning mechanisms to reduce the overall supply of LUNC and discussing potential rebranding strategies. These measures aim to restore investor confidence and differentiate the project from its troubled past.

Additionally, the community is exploring integrations with new projects and decentralized applications to broaden LUNC’s utility and encourage adoption within the web3 ecosystem.

Despite these efforts, the fallout from the TerraUSD crash continues to pose regulatory challenges for LUNC, impacting its credibility in the financial market.