Following the founder of Terraform’s arrest in Montenegro and the United States’ swift filing of fraud charges against him, South Korea declared it would seek the extradition of the wanted cryptocurrency entrepreneur, Do Kwon.
This was disclosed to AFP by the prosecution on Friday.
Kwon, whose full name is Kwon Do-hyung, has been charged with fraud in connection with the abrupt demise of his business last year, which destroyed roughly $40 billion in investor capital and rocked the world’s cryptocurrency markets.
According to the nation’s interior ministry, the 31-year-old was detained on a South Korean warrant at the Podgorica airport in Montenegro.
After a lawsuit by the US Securities and Exchange Commission, the United States quickly after his detention charged him with eight counts, including securities fraud and wire fraud.
Assuring that they will seek his extradition, South Korean police revealed on Friday that Kwon had been wanted for alleged violations of the nation’s capital markets statute.
To repatriate Kwon Do-hyung, South Korean prosecutors will take action. According to Kim Hee-kyung, a spokeswoman for the Seoul Southern District Prosecutors’ Office, “We are working on the process.”
According to reports, Kwon took a flight from South Korea to Singapore before the company’s accident in May of last year.
Prosecutors in South Korea asked Interpol to add him to the red notice list for all 195 of the organization’s members in September, and they also revoked his passport.
But, once the Singapore Police Force stated that he was not in the nation, concerns regarding his whereabouts grew.
Kwon “used forged travel documents from Costa Rica” at passport control for a flight to Dubai, according to Montenegrin authorities, who claimed this on Thursday.
According to the interior ministry of Montenegro, travel documents from Belgium and South Korea were uncovered during luggage inspection, while Interpol investigations revealed that the Belgian passports were fakes.
When Kwon’s Luna and Terra went into a death spiral, many investors lost their entire life savings, which prompted South Korean authorities to launch numerous criminal investigations regarding the crash.
The National Police Agency of South Korea declared that it would work with the nation’s prosecutors to request Kwon’s extradition.
According to Jeong Beom-seok from the National Police Agency, who works closely with Interpol, “we will vigorously cooperate with the Seoul Southern District Prosecutors’ Office.”
According to a statement from the justice ministry, Montenegro and South Korea are both signatories to the European Convention on Extradition, a multilateral agreement that enables extradition between members.
The statement said, “The justice ministry will carry out the extradition procedure in conformity with laws and international agreements.
Recall that regulators from all over the world have increased their monitoring of cryptocurrencies as a result of a number of recent issues, including the high-profile failure of the exchange FTX.
US Securities and Exchange Commission claims that Kwon “orchestrated a multi-billion dollar crypto asset securities scheme.”
Cho Dong-keun, an emeritus professor of economics at Myongji University, said to AFP: “It is true that Kwon has caused too much harm to too many individuals with something that carried a lot of inexplicable hazards.”
It’s terrible that he left, though. A mature adult and businessperson would have stayed and given an explanation. His character is revealed by the fact that he even attempted to use counterfeit passports to elude capture.
His TerraUSD was advertised as a “stablecoin,” which is often linked to reliable assets like the US dollar to prevent sharp price swings.
Nevertheless, TerraUSD was a “algorithmic stablecoin” that was solely tethered to its floating sister currency Luna and was not backed by any assets. And about $40 billion in market value was destroyed when the two currencies fell into freefall in May 2022.
According to Bloomberg News, which cited the US SEC, Kwon and Terraform Labs also moved more than 10,000 bitcoin out of their failed project and changed part of the tokens into cash via a Swiss bank.
According to Kim Dae-jong, a professor of business administration at Sejong University, “Kwon definitely needs to be held accountable for his acts.”
The fact that Kwon didn’t manage the business in accordance with morals and the law is the bottom line. He took advantage of it to further his own interests financially, Kim said.