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A bail deal for Terra Labs co-founder Do Kwon struck last week with a Montenegrin court is now in question after the State Prosecutor’s Office filed an appeal against it. Kwon is still wanted for extradition in South Korea and needs to face criminal charges in the United States.
On May 17, the State Prosecutor’s Office of Podgorica, the capital of Montenegro, appealed against the previous court decision to release Do Kwon and Han Chang-Joon, CFO of Terraform Labs, from custody on bail of 400,000 euros ($436,000) each.
The bail deal was finalized on May 12. The court agreed to place Do Kwon under house arrest instead of detention. It took the court only one day to agree with Do Kwon’s lawyers’ proposal. According to the documents, if house arrest is compromised, bail will be placed in a “special section” of the court’s working budget.
Kwon and Chang-Jun were arrested by Montenegrin authorities in March 2023 at Podgorica airport, allegedly for using false documents. Two had their passports confiscated in South Korea, their country of origin. Back in 2022, the Terra Luna (LUNC) dual-token ecosystem created by Kwon and Terraform Labs collapsed after depegging the TerraUSD (USTC) native stablecoin, wiping out an estimated $40 billion of market value in a matter of days.
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So far, the former CEO of Terraform Labs has over 233.3 billion Korean won ($176 million) seized in personal assets frozen as part of an ongoing criminal investigation. South Korean prosecutors are seeking his extradition, and the U.S. attorney is filing eight separate charges against him, including commodity fraud, securities fraud, wire fraud, and conspiracy to commit fraud and market manipulation.