In what might serve as a bitter pill to swallow for victims of the Terra LUNA and UST collapse, Do Kwon, the controversial co-founder of Terraform Labs, has been released from a Montenegro jail roughly a year after being arrested in March 2023.
While this development is positive for Kwon in the immediate term, it also injects fresh uncertainty into the ongoing legal saga surrounding the TerraUSD (UST) collapse.
UST was an algorithmic stablecoin that crashed in May 2022, resulting in billions in investor losses – the stablecoin relied on algorithms to maintain its 1:1 peg with the USD. LUNA, the governance token, was used to stabilize the token.
Do Kwon Walks Free in Montenegro – For Now
According to a Bloomberg report, the Montenegrin Supreme Court halted Kwon’s extradition on procedural grounds, throwing a wrench into the extradition plans of South Korea and the United States.
Both countries have had prosecutors submit competing extradition requests to have Do Kwon face fraud charges in their respective jurisdictions.
They claim that Do Kwon could have played a major role in the collapse, misleading people into investing in UST and LUNA.
Footage of Do Kwon today pic.twitter.com/qwM77ihTvB
— Spreek (@spreekaway) March 23, 2024
As a result, if extradited, the potential penalties he faces are significant, adding to the intrigue of this legal saga.
However, Kwon has vehemently denied any wrongdoing – through his lawyers, the former co-founder claims that UST collapsed not because of deliberate manipulation but due to unfavorable market forces.
But while it looks like Do Kwon’s release is far from a resolution, the Montenegrin Supreme Court will still review the extradition requests from South Korea and the United States. Therefore, his ultimate fate hangs in the balance.
After being released, Do Kwon’s passport was confiscated, and he will have to stay in the country until a final extradition decision is made.
With Do Kwon Released – Terra LUNA Surges 130% – Set For Rebound in 2024?
The news of Do Kwon’s release in Montenegro has predictably sent ripples through the crypto market. So far, LUNA prices are steadily rising, benefiting from the broader recovery, especially in the Bitcoin markets.
(LUNAUSDT)
LUNA is changing hands at around $1.30, way lower than the peak all-time high of $120 in 2021, and the recent gains fuelled by Do Kwon’s release leaves Terra LUNA up roughly +130% in 2024.
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Disclaimer: Crypto is a high-risk asset class. This article is provided for informational purposes and does not constitute investment advice. You could lose all of your capital.
