Terraform Labs co-founder Do Kwon is unlikely to attend a trial by the U.S. Securities and Exchange Commission (SEC) on fraud charges related to delays in the Montenegro-based company’s extradition. At Kwon’s request, the trial, which was scheduled to begin the previous month, was postponed until March 25.
In February 2023. The SEC filed a lawsuit against Terraform Labs and its founders for their alleged role in the collapse of cryptocurrencies TerraUSD (UST) and Luna (LUNA) in May 2022. Authorities estimate that the event caused losses of about $40 billion in cryptocurrency markets.
In federal court in Manhattan, David Patton, Kwon’s lawyer, said his client would not request an adjournment, regardless of when the extradition process is completed, Reuters reported.
According to the SEC, Terraform Labs and Kwon misled investors about the stability of UST, a stablecoin aimed at maintaining the $1 price. In addition, the lawsuit includes false data on how a well-known Korean mobile payment app, Terraform, used blockchain to settle transactions.
Terra’s founder says he is not guilty and faces separate criminal charges in the United States. He has been living in Montenegro since his arrest in March 2023 .
A court in Podgorica, Montenegro, ruled that Kwon should be extradited to the United States, rejecting his request – extradition to South Korea.
However, Do Kwon has filed an appeal against the verdict, and Goran Rodić, a lawyer in his locality, said the ruling was based on “inaccurate information” regarding the order in which extradition requests were received.
Earlier, Kwon’s lawyer said that according to the Constitution, Kwon should be extradited to South Korea, not the United States.
In a statement accompanying Patton ‘s letter, Rodic said that due to “unforeseen mistakes” made during the court proceedings in Montenegro, Kwon’s extradition would not take place before the end of March.
Earlier in December 2023, District Judge Jed Rakoff, who oversaw the SEC case, ruled that Terraform Labs and its founder had failed to register UST and LUNA in violation of US law.
