Crypto entrepreneur Do Kwon pleaded not guilty in a court in Montenegro, where he was detained on an international warrant and charged by local authorities with using forged travel documents.
(Bloomberg) — Crypto entrepreneur Do Kwon pleaded not guilty in a court in Montenegro, where he was detained on an international warrant and charged by local authorities with using forged travel documents.
The Terraform Labs co-founder and its former chief financial officer, Han Chang-joon, were caught at the airport in Montenegro’s capital Podgorica in March when they tried to board a private jet to fly to Dubai. Kwon had been a fugitive for months after the collapse of his TerraUSD stablecoin in May last year sparked a criminal investigation in his native South Korea.
Defense lawyer Branko Andjelic proposed freeing them on bail of 400,000 euros ($437,240) each, but the prosecutor, Haris Sabotic, strongly objected, saying the two have ample financial means, but zero interest in staying in Montenegro. The next hearing will be June 16.
Kwon has been charged by US prosecutors with orchestrating a years-long cryptocurrency fraud that wiped out at least $40 billion in market value, and faces similar charges in South Korea. Both countries are seeking Kwon’s extradition from Montenegro, where justice officials said they may consider handing him over only after the local criminal proceedings are completed.
The two were found carrying Belgian and Costa Rican travel documents, in addition to at least one passport issued by their native South Korea, Montenegrin officials said in March. The Belgian and Costa Rican passports were falsified, according to Interpol and Montenegro. Both men said in court the Costa Rican passports they tried to use were valid.
Using forged documents is punishable by as many as five years in prison under Montenegrin laws.
Kwon’s first hearing at the Basic Court in Podgorica comes almost exactly a year after the implosion of TerraUSD, an algorithmic stablecoin, and its sister token Luna. That event accelerated a broader $2 trillion downturn in the crypto market. Officials in South Korea say the Terra project Kwon helped create was a “fabrication” from its inception as the algorithm that helped keep TerraUSD at a stable price was impossible to get right.
Prior to the TerraUSD collapse, those involved in the project took 463 billion won ($350 million) in profit, South Korean officials said last month. The other Terraform Labs co-founder, Daniel Shin, was indicted in April along with nine others on charges that include violation of capital markets law.
South Korean prosecutors have frozen about 233 billion won of Kwon’s assets, including his house in Seoul and an imported luxury car, along with securities, bank deposits and cryptocurrencies, Korean Economic Daily reported on Thursday.
(Corrects spelling of Korea in last paragraph.)
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