Terraform Labs Co-Founder Do Kwon Pleads Not Guilty in US Court

Do Kwon, the co-founder of Terraform Labs, has pleaded not responsible to United States fraud costs associated to the $40 billion Terra LUNA crash in 2022. Solely two days in the past, the Montenegro authorities extradited him to the U.S.

In keeping with a Bloomberg report, the troubled co-founder faces 9 financial-related costs, together with cash laundering conspiracy, commodities fraud, wire, and securities.

Do Kwon Pleads Not Responsible

The U.S. Justice of the Peace Decide Robert Lehrburger presided over the court docket listening to, which was publicized on January 2nd. Though pleading not responsible by his lawyer, the South Korean fugitive agreed to be detained. Whether or not the court docket will contemplate Kwon’s plea deal or progress to a legal trial stays unsure.

Notably, the U.S. Lawyer’s workplace in Manhattan, which is able to prosecute the troubled Terraform Labs co-founder, was additionally behind the prosecution of FTX co-founder Sam Bankman-Fried (SBF) final 12 months. SBF, on his half, is presently serving a 25-year jail term over the cataclysmic FTX crash in late 2022.

As of March 2023, Kwon confronted eight counts of financial-linked violations. Nevertheless, U.S. Lawyer Damian Williams said in a court document that the Terraform Labs’ government conspired with a number of entities to commit cash laundering. Because of this, Kwon presently faces 9 costs, significantly increased than SBF’s seven counts.

A Two-12 months-Previous Case

Kwon’s authorized troubles date again to Could 2022, when Terraform Labs’ flagship merchandise, TerraUST and Terra LUNA, crashed. It brought about a $40 billion meltdown within the crypto market, triggering a sequence of occasions that led to FTX’s crash later that 12 months.

Kwon has been on the run ever since. Final 12 months, Montenegro authorities apprehended the Terraform Labs co-founder whereas he was attempting to take a flight to Dubai utilizing a pretend passport. He spent 4 months in jail for utilizing a false ID within the nation.

Across the identical time, authorities in South Korea and the U.S. requested Kwon’s extradition. Each international locations acquired into a back-and-forth extradition battle over Kwon. Finally, the Montenegro authorities disclosed in late December 2024 that the troubled crypto determine had been extradited to the U.S. to face fraud costs.