Montenegro extradites crypto businessman Do Kwon to US

Podgorica:

Montenegro on Tuesday extradited to the United States South Korean cryptocurrency expert Do Kwon, who is also wanted in Seoul over the bankruptcy of his multibillion-dollar company, officials said.

Montenegro’s Interior Ministry said in a statement that Do Kwon “was handed over to the competent law enforcement authorities of the United States of America and agents of the Federal Bureau of Investigation (FBI).”

The statement added that he was extradited based on the decision of the Montenegrin Ministry of Justice to face “criminal proceedings in the United States on charges of conspiracy to commit fraud.”

For months, Seoul and Washington have sought the South Korean’s extradition for his suspected role in a fraud linked to the failure of his company, which wiped out about $40 billion of investors’ money and rocked global cryptocurrency markets.

Last week, Justice Minister Bojan Bozovic issued a decision approving the extradition after a year and a half of court rulings and subsequent cancellations.

Kwon’s lawyers in Montenegro denounced the decision as contravening European conventions on extradition, and said they would appeal to the country’s Constitutional Court and the European Court of Human Rights.

“Today, the Republic of Montenegro completed the extradition of Do Kwon to the United States to face charges in the Terra/Luna case,” Montenegrin Prime Minister Milojko Spajic said in statements to Channel X.

“This delivery demonstrates our unwavering commitment to international justice and the rule of law!”

The fall of “genius”

The cryptocurrency mogul was arrested in March 2023 at the airport in Podgorica, the capital of Montenegro, as he prepared to board a flight to Dubai, in possession of a fake Costa Rican passport.

Before his arrest in the small Balkan country, he had been on the run for several months, fleeing South Korea and then Singapore, before his company went bankrupt in 2022.

Montenegro had already deported Kwon’s business partner – identified only by his initials JCH – to South Korea in early February.

Terraform Labs created a cryptocurrency called TerraUSD that was marketed as a “stablecoin,” a token tied to stable assets like the US dollar to prevent radical fluctuations.

Do Kwon successfully marketed it as the next big thing in cryptocurrency, attracting billions in investment and global buzz.

Media reports in South Korea described him as a “genius.”

But despite billion-dollar investments, TerraUSD and its token sister Luna entered a death spiral in May 2022.

Experts said Kwon created a glorified pyramid scheme, where many investors lost their savings.

He left South Korea before the incident and spent months on the run.

In January, Terraform Labs officially filed for bankruptcy protection in the United States.

The bankruptcy filing will allow Terraform to “execute its business plan while navigating ongoing legal proceedings, including pending representative litigation in Singapore and U.S. cases involving the Securities and Exchange Commission,” the company said in a statement.

It said it also intends to “fulfill all financial obligations to employees and vendors.”

Cryptocurrencies have come under increasing scrutiny from regulators after a series of controversies in recent years, including high-profile exchange collapses.

(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)