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Montenegro has made a significant decision regarding Do Kwon, the founder of the Terra cryptocurrency. Instead of sending him to the U.S., Montenegro will extradite Kwon to South Korea. This choice is a major step in the legal process, as South Korea is where Kwon faces charges. The decision has caught the attention of many in the cryptocurrency world and beyond
Montenegro to Extradite Do Kwon to South Korea
According to reports, Terraform Labs co-founder Do Kwon, who is embroiled in a fraud case, will be extradited from Montenegro to South Korea, following a recent ruling by the country’s appellate court. This decision upholds a previous verdict from the High Court of Podgorica, favoring South Korea's request over that of the U.S., which also sought Kwon's extradition.
Both South Korea and the U.S. aim to charge Kwon for his role in the $40 billion collapse of the Terra/LUNA ecosystem in May 2022. This incident marked the start of a wave of significant failures in the cryptocurrency sector that year, including the downfall of FTX, the second-largest crypto exchange globally.
Do Kwon's Legal Battle: Extradition Decision and Delays
After the collapse of Terra, Do Kwon went into hiding. In September 2022, Interpol issued a red notice for his arrest. Kwon was detained in March 2023 in Montenegro for attempting to board a flight to Dubai with a forged Costa Rican passport.
Although he was initially sentenced to four months in prison for using fake documents, he remained in custody until March of this year. He was released on bail, with his actual passport confiscated to prevent him from leaving the country.
The latest court decision is expected to resolve the ongoing dispute over Kwon's extradition, which had been contested between South Korea and the U.S. South Korea's request, which was submitted first, has been prioritized. Kwon had previously managed to block efforts to extradite him to the U.S., and when the High Court of Podgorica ruled in favor of sending him to South Korea, the Supreme Court intervened to delay the process. The delay came after the top prosecutor argued that the High Court had overstepped its authority. This decision ends a series of legal maneuvers concerning his extradition.
What Could Be the Impact of This on Terra?
The extradition of Do Kwon to South Korea could have several implications for Terra, both in terms of its current reputation and future developments. Kwon’s departure from Montenegro and the resolution of his legal troubles may shift the focus away from Terra's past controversies, potentially allowing the project to refocus on its recovery and future growth.
However, the prolonged legal battle and Kwon's association with the collapse of Terra could continue to cast a shadow over the project's reputation, affecting investor confidence and market perception.
In the short term, Terra may experience a temporary boost in stability and credibility if Kwon’s legal issues are resolved, enabling the team to reassert control and demonstrate progress.
On the other hand, ongoing legal uncertainties and the negative publicity surrounding Kwon's extradition might exacerbate existing challenges and hinder the project's efforts to rebuild trust and attract new investment. Ultimately, the impact on Terra will depend on how the project navigates this period of transition and whether it can effectively distance itself from the controversies associated with its founder.