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Terraform Labs Founder Do Kwon to Be Released on $440K Bail (Report)

Terra’s Do Kwon Reportedly Arrested in Montenegro

Do Kwon, founder of Terraform Labs, the company behind Terra stablecoin and Luna cryptocurrency, has pleaded not guilty to charges of traveling to Montenegro on a forged passport.

Kwon, along with Terraform’s CFO Han Chang-Joon, denied the document forgery charges at the Basic Court of Montenegro’s capital Podgorica.

A local report states that Kwon proposed a €400,000 bail which was approved by the court. He is set to be released ahead of the trial, despite the prosecutors’ objection arguing that Kwon and Chang-Joon have no interest in remaining in Montenegro until the court date.

Kwon Proposes €400K for Bail

Kwon and Han were detained at the Podgorica airport on March 23, with charges filed against them on April 2. During the May 11 hearing, their lawyers sought bail and proposed a combined amount of €400,000. They also requested the court to define the measures for the defendants to leave the apartment during the prohibition and its supervision.

“A trial was held before the Basic Court in Podgorica in the case against the defendants C.J.H. and K.D.H., who are accused of having committed the criminal offense of document forgery. At the main hearing, the defendants denied the commission of the criminal offense they were charged with and presented their defense,” Podgorica’s Basic Court, in a statement, said.

The defense lawyers further asked the court to permit Kwon and Han to report to the state authority periodically, while the state prosecutors opposed these proposals. The decision is yet to be announced, with June 16 set as the next hearing date.

No Immediate Extradition

Following his arrest, the US and South Korea have officially requested Montenegro for Kwon’s extradition. Speaking at a press conference in Podgorica on March 23, the Justice Minister Marko Kovac revealed that Kwon and Han had been charged for traveling to Montenegro on forged documents. They will be deported only after serving their sentence, as determined by courts. Moreover, both countries have requested the Montenegrin authorities to hand over the computers of the two arrested Terraform executives.

After the collapse of Terra and Luna coins in early May 2022, which resulted in a loss of nearly $40 billion in the crypto market, the South Korean courts clubbed the complaints from affected investors. They aimed to bring Kwon and his associates to justice, with Kwon refuting any wrongdoing, stating that his business strategies failed which led to the collapse of the Terra-Luna ecosystem. However, he has refused to answer the summons and evade arrest by South Korean authorities.