Release of Terra Founder Do Kwon in Montenegro Amid Extradition Deliberations

Terra founder Do Kwon has been released from detention in Montenegro while the Supreme Court considers extradition requests from the United States and South Korea. According to a Bloomberg report on Saturday, March 23, Kwon’s release occurred following the Supreme Court’s suspension of a lower court’s decision, which initially favoured extradition to South Korea.

Kwon is currently accused of fraud in both South Korea and the U.S. due to the collapse of Terra, which resulted in a market value loss of around $60 billion in 2022. Darko Vukcevic, the prison director, stated via phone that Kwon was released as his regular prison term for using fake travel documents had ended. However, since he is a foreign national and his documents were confiscated, he was taken for further questioning by the police directorate for foreigners.

The decision to release Kwon was reportedly made by the Council of the Supreme Court, pending a review that could either approve or deny his extradition to South Korea. Penalties in South Korea are seen as less severe compared to those in the U.S., where prosecutors seek to charge Kwon for the collapse of TerraUSD, an algorithmic stablecoin, resulting in a $40-billion loss in 2022.

Kwon’s lawyer, Goran Rodic, confirmed his release, but stated that his passport was withheld to prevent him from leaving Montenegro. Later, Kwon was moved to a shelter for foreigners, with plans to appeal to the court for his continued freedom until a ruling on extradition is reached.

The Supreme Court’s decision followed a challenge by the chief prosecutor in Montenegro, who highlighted procedural errors in the rulings favouring South Korea’s extradition request. Further deliberations are required for extradition to either country, with no specified timeframe provided after the announcement on Friday.

Welcome back Do kwon 🔥🔥 pic.twitter.com/b1YOxKnrwE

— Kurma 🧩🐂 (@whynotpump) March 23, 2024

If extradited to the U.S., Kwon could potentially face eight felony charges filed by prosecutors in March 2023. He was initially arrested in Montenegro in March 2023 along with his former colleague, Terraform Labs’ ex-chief financial officer, Han Chang-joon, for using falsified travel documents. Both the U.S. and South Korea have submitted extradition requests, but a final decision is pending.