The legal tug-of-war between the United States and South Korea over the extradition of Terra founder Do Kwon continues to unfold. Despite a recent high court ruling overturning the plans for extradition, the U.S. Department of Justice remains steadfast in its intention to bring Kwon within U.S. borders, as reported by Bloomberg on March 8.
The ongoing extradition battle involving Do Kwon
The Justice Department reiterated its pursuit of Kwon’s extradition, emphasizing adherence to international agreements and Montenegrin law. They expressed gratitude for the cooperation of Montenegro in upholding the rule of law.
Meanwhile, South Korea is intensifying its efforts to secure Kwon’s extradition. The National Police Agency of South Korea has formally requested Interpol’s assistance in extraditing Kwon from Montenegro, following a recent High Court ruling. This ruling overturned a previous decision to extradite Kwon to the United States due to procedural errors regarding the order of extradition requests between South Korea and the U.S. Despite prior approval of the U.S. extradition by lower courts, this recent development has added complexity to the legal proceedings.
Both countries are pursuing Kwon for his involvement with the now-defunct Terra blockchain, a stablecoin network that experienced a significant collapse in May 2022, resulting in the loss of $44 billion in investor funds. The fallout from this collapse led to further notable failures at companies such as Three Arrows Capital, Celsius, and FTX.
Following these events, the U.S. Securities and Exchange Commission (SEC) has accused Kwon of various charges related to investor deception. These include allegations of intentionally defrauding investors, particularly through the sale of the platform’s native LUNA token, which the SEC claims was done without proper registration as a security.
A Lean Towards South Korea
Extradition to South Korea is viewed favorably by Kwon and his legal team, as they anticipate a more lenient sentence compared to potential consequences in the United States. This preference is underscored by the belief that South Korea’s legal system might offer Kwon a lighter penalty.
Terrence Yang, Managing Director at Swan Bitcoin, expressed concern over the implications of Kwon’s potential extradition to South Korea. He argued that such a decision could thwart the pursuit of justice by victims, particularly those in the United States, who are seeking appropriate restitution.
Yang pointed out the stark contrast in potential outcomes, highlighting the U.S. judicial system’s tendency to impose severe penalties for financial crimes. He referenced the conviction of Sam Bankman-Fried, the founder of FTX, who faces significant prison time for similar offenses.
Moreover, a group of Terra investors from South Korea have voiced their support for Kwon’s extradition to the United States. They believe that it is in the U.S. legal system where Kwon would be subjected to more stringent punishment, ensuring accountability for his actions.
