Higher Court in Montenegro Orders Six-Month Extradition Custody for Do Kwon and Han Chang-Joon

Terraform Labs founder, Do Kwon, and his business partner, Han Chang-Joon, are set to be taken into extradition custody in Montenegro for a period of six months, according to a recent report by the regional edition of Radio Free Europe (RFE). The decision was made by the higher court in Podgorica and follows their previous release on €400,000 ($438,000) bail each.

The Special State Prosecutor’s Office is set to interrogate Kwon regarding his alleged ties to Milojko Spajić, a prominent political figure in Montenegro. Kwon’s letter claiming to have financial ties with Spajić, who is a prime minister candidate and leader of the Europe Now! party, has raised concerns and attracted attention. Prosecutors are evaluating whether Kwon’s alleged financial contributions to the party’s campaigns have any relevance to the ongoing investigation into corruption and financial crime.

Kwon’s custody extension, ordered by the Montenegrin High Court, comes as the court deliberates on the extradition requests from both the United States and South Korea. In September, a Seoul court issued an arrest warrant for Kwon for violations of the Capital Markets Act. The United States has also sought Kwon’s extradition to face charges brought by federal prosecutors and the U.S. Securities and Exchange Commission.

Alongside Kwon, former Terraform Labs CFO Han Chang-Joon is also implicated in the case. Both were arrested on March 23 at the Podgorica airport for attempting to travel with falsified documents. The Montenegrin Basic Court scheduled a hearing for June 16 to address the charges related to the falsified travel documents.

The unfolding legal proceedings, including the potential extradition of Kwon, carry significant implications for his personal future and the fate of Terraform Labs. The collapse of the Terra ecosystem and its stablecoin UST in May 2022 resulted in substantial losses estimated at up to $40 billion. As the legal battle intensifies, the outcomes of the extradition process and subsequent investigations may potentially establish a precedent for accountability within the cryptocurrency industry, impacting not only Kwon’s future but also the broader landscape.