The Appellate Court of Montenegro ruled on Thursday that Terraform Labs co-founder, Do Kwon, should be returned to his home country, South Korea. The ruling confirmed an earlier decision in April from the High Court of Podgorica which rejected a request to extradite the crypto fugitive to the U.S. The extradition date for Kwon to South Korea has not yet been set.
The ruling on August 1 in Montenegro is the latest decision in a series of back-and-forth and protracted legal battles for the disgraced crypto founder. Following a March ruling by a high court in Montenegro to return Kwon to South Korea, the top court decided to scrap the decision and sent the case to a lower court in April.
“There was no appeal against the aforementioned decision, so the decision of the High Court in Podgorica, in the part in which extradition is allowed in a shortened procedure at the request of the Republic of Korea, is legally binding,” read the court’s statement Thursday.
Terraform Labs, which was founded in 2018, wiped out at least $40 billion in market value and collapsed the crypto industry in May 2022. Earlier this year, following the collapse of its own cryptocurrencies in 2022, Terraform Labs filed for Chapter 11 bankruptcy in Delaware.
Both the U.S. and South Korea have sought Kwon’s extradition from Montenegro to face charges in the wake of his arrest at an airport in the country carrying falsified travel documents.
The U.S. Securities and Exchange Commission (SEC) sued Kwon and Terraform, alleging they defrauded U.S. investors who purchased its digital assets, TerraUSD and Luna, in February 2023. At the same time, Kwon is wanted in South Korea on allegations of fraud and financial crimes related to the implosion of Terra USD and Luna in May 2022.
In a statement in March the U.S. Department of Justice had said it continues to seek Kwon’s extradition “in accordance with relevant international and bilateral agreements and Montenegrin law.”
In the event, the crypto fugitive looks set to be returned to face justice in South Korea.
Kwon was arrested in Montenegro in March 2023 after attempting to travel to Dubai on a counterfeit passport. The founder of Terraform Labs was sentenced to four months in jail but remained in custody until being released on bail in March 2024.
To settle a civil securities fraud lawsuit, Kwon’s now bankrupt company agreed to pay the U.S. SEC a penalty of just under $4.5bn. The deal included a contribution from Kwon of $204 million. Terraform Labs also agreed to wind down its operations. Just last month, it announced a strategic sale process as part of the ongoing Chapter 11 case.