Do Kwon Extradited for $40B Crypto Fraud in US Court
Terraform Labs’ co-founder, Do Hyeong Kwon, has been extradited to the United States on allegations of orchestrating a $40 billion cryptocurrency fraud. The charges against Kwon include market manipulation and money laundering, with the potential for up to 130 years in prison if convicted.
Kwon was apprehended in Montenegro in March 2023 while trying to evade extradition using a fake passport. He appeared in federal court in Manhattan, where U.S. Attorney General Merrick Garland emphasized the significance of this extradition in holding financial criminals accountable.
The accusations against Kwon revolve around his alleged manipulation of Terraform’s cryptocurrencies, TerraUSD (UST) and LUNA. The collapse of TerraUSD in May 2022 resulted in a catastrophic market collapse, wiping out over $40 billion in investor funds. Federal prosecutors claim that Kwon misled investors about Terraform’s blockchain technology and engaged in money laundering through complex schemes.
James E. Dennehy, Assistant Director of the FBI’s New York office, described Kwon as a puppet master who deceived global investors for four years. If convicted, Kwon could face a significant sentence of up to 130 years in prison, making this case a crucial moment in cryptocurrency fraud enforcement.
