Montenegro is currently holding Terraform Labs co-founder Do Kwon in standard medical quarantine, as the US and South Korea pursue him over a cryptocurrency fraud that wiped out at least $40 billion in market value. Kwon, who will remain in quarantine until April 3, can only be visited by his lawyer or doctor, according to Rade Vojvodic, the head of Montenegro correctional facilities.
Detained in Montenegro after Attempted Escape to Dubai
Kwon and the company’s chief financial officer, Hon Chang Joon, were arrested in Podgorica on Thursday as they attempted to fly to Dubai using falsified travel documents. Montenegro’s Interior Ministry reported that the two men were also found with Belgian and South Korean travel documents, with the Belgian papers falsified, according to Interpol.
The arrest followed the collapse of Terraform’s TerraUSD stablecoin last spring, which sent shockwaves through the cryptocurrency world. The stablecoin was intended to maintain a constant value of $1 through a blend of algorithms and trader incentives involving its free-floating sister token Luna. However, confidence in Kwon’s project vanished during a few chaotic days in early May, causing both Luna and Terra to unravel.
South Korea and US Seek Extradition
Kwon has been the subject of continuous speculation since September, when South Korean authorities issued a warrant for his arrest on allegations including breaches of capital-markets law. Both US federal prosecutors and South Korea have expressed their intentions to seek Kwon’s extradition to face criminal charges. Montenegrin authorities, however, have not yet received any extradition requests.
The 31-year-old Kwon and Hon Chang Joon are currently under investigative detention, which lasts up to 30 days. As they were apprehended with several passports under different names, such detention was ordered “to formally assess their identity,” Vojvodic said.
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Conclusion
In conclusion, the detention of Terraform Labs co-founder Do Kwon in Montenegro has drawn international attention as authorities seek to address the allegations of a massive $40 billion cryptocurrency fraud. As the case unfolds, it highlights the need for increased scrutiny and regulation within the rapidly evolving crypto space to ensure that investors are protected from potential risks. The developments in Kwon’s case will be closely watched by the crypto community, regulatory bodies, and governments worldwide as they grapple with the challenges posed by the ever-expanding digital currency landscape.