Do Hyeong Kwon Faces Justice: Extradition and Fraud Charges in Cryptocurrency Collapse
Do Hyeong Kwon Extradited to U.S. to Face Fraud Charges in Terraform Collapse
Do Hyeong Kwon, the co-founder and former CEO of Terraform Labs, has been extradited from Montenegro to the United States and appeared in federal court in Manhattan to face serious charges related to widespread fraud. This high-profile case has gained international attention after Kwon’s alleged manipulation of digital assets led to the catastrophic collapse of Terraform’s cryptocurrencies in 2022, resulting in an estimated $40 billion in losses for investors.
Upon his arrival in the U.S. on December 31, 2024, Kwon, now 33, was presented before U.S. Magistrate Judge Robert W. Lehrburger. His case is set to be heard by U.S District Court Judge John P. Cronan, with the next hearing scheduled for January 8, 2025. Kwon’s extradition marks a crucial win for U.S. authorities, who pursued him for months following the dramatic downfall of Terraform’s products.
Attorney General Merrick B. Garland stated, “Kwon will now be held accountable for his elaborate schemes.” The indictment accuses him of misleading investors by artificially inflating the value of Terraform’s digital assets, including the tokens TerraUSD (UST) and LUNA. Prosecutors assert that Kwon used deceptive practices and market manipulation between 2018 and 2022, raising the market value of the tokens to over $50 billion before their collapse.
Additionally, Kwon allegedly misrepresented the functions of Terraform’s stablecoin protocol and manipulated trading on the Mirror Protocol platform. Federal authorities are particularly focused on Kwon’s purported attempts to flee justice, which included using a fraudulent passport during his arrest in March 2023.
If convicted on all counts, which include commodities fraud, securities fraud, and money laundering, Kwon could face up to 130 years in prison. As the case unfolds, it underscores the critical need for accountability in the burgeoning cryptocurrency market.