According to a Wall Street Journal report, Former Terraform Labs CEO Do Kwon appears to be heading to the United States. Kwon risks extradition to the United States, according to the article. Not in South Korea, where he was born. Both countries are mentioned in the allegations.
Kwon has been in a Montenegrin prison since March. He was imprisoned after being accused of forging travel documents. In June, he received a four-month term.
The U.S. Securities and Exchange Commission (SEC) is investigating him and Terraform Labs for offering and selling unregistered securities. Kwon is accused of fraud and violating capital market legislation in South Korea.
Following the devastating demise of the algorithmic stablecoin TerraUSD (UST), regulators focused on Kwon and his company. This event triggered a $40B fall in the cryptocurrency market. It failed lenders exposed to UST, such as Celsius and Voyager.
A court granted Kwon's extradition last month. Andrej Milovic, the Justice Minister, had to decide where Kwon would go. Kwon expressed his opposition to the extradition decision through Montenegrin media.
Milovic, as quoted anonymously in WSJ, claimed that he would promptly notify the public of his decision.
The SEC and Terraform are still in talks in the United States. The point of controversy is Kwon's deposition, which his lawyers are contesting, as well as Judge Jed Rakoff's summary judgment.
The SEC is requesting a decision from Judge Rakoff. It seeks a decision on whether the tokens, as claimed, constitute securities. If Judge Rakoff makes a ruling, it will take the place of a jury decision.
