Montenegro's Constitutional Court has unanimously rejected Do Kwon's appeal against extradition, closing yet another legal avenue for the Terraform Labs co-founder.
The court cited legal inconsistencies in Kwon's case, upholding an earlier ruling in favour of extradition.
Kwon, under global scrutiny since the $40 billion Terra Luna collapse in 2022, faces allegations of fraud and financial misconduct from both the United States and South Korea, both of which have requested his extradition.
The ruling paves the way for Montenegro's Justice Minister to finalise Kwon's extradition destination, with the US emerging as the likely choice due to the ministry's established stance.
Meanwhile, South Korean authorities continue to seek Kwon's return to face charges tied to the TerraUSD (UST) and Luna token crash.
This pivotal decision could set a significant precedent for cross-border accountability in the cryptocurrency space.
Kwon's legal team argued that the ruling infringed on procedural fairness and his rights to a fair trial and family life.
However, Montenegro’s Constitutional Court dismissed these claims, leaving the decision on his extradition to the Justice Minister.
Reports suggest that Montenegro may favour extraditing Kwon to the US over South Korea, with national interests potentially influencing the choice.
Despite the setback, Kwon’s legal team is expected to persist in opposing his transfer to the US, where he faces multiple charges.
Meanwhile, South Korean authorities have urged Montenegro to expedite the extradition, citing concerns about prolonged proceedings potentially leading to human rights violations.
While the exact timeline remains unclear, the court's ruling has considerably limited Kwon's legal avenues.
Kwon's legal turmoil traces back to the May 2022 collapse of his Terra Luna crypto ecosystem, which wiped out $40 billion in market value.
The debacle sparked investigations into fraud, market manipulation, and securities law violations, shaking investor confidence in stablecoins and decentralised finance (DeFi) while triggering global regulatory crackdowns.
Kwon was arrested in Montenegro in March 2023 while attempting to use a forged passport.
Montenegrin police officers escorting Do Kwon out of a court in Podgorica, Montenegro on March 23
In April, a US court held Terraform Labs and Kwon liable for fraud following charges by the SEC, which accused him of misleading investors and recklessly mismanaging funds.
Despite being in custody in Montenegro, Kwon did not attend the trial where the settlement was reached.
The country’s judiciary now faces the complex task of deciding on dual extradition requests from the US and South Korea, a decision likely to hinge on geopolitical considerations.
According to testimony from CEO Chris Amani, the company holds $150 million in assets, but it remains unclear how it plans to meet the substantial fines.
As Kwon awaits the Justice Minister's decision, his legal and financial challenges continue to mount, leaving a lasting impact on the crypto industry.
Controversy erupted nearly a week after Terraform Labs settled with the SEC when an April court document implicated Montenegrin Prime Minister Milojko Spajic in the crypto firm's early operations.
Spajic, who took office in October 2023, reportedly invested $75,000 in April 2018 to acquire 750,000 Terra tokens.
Previously, Spajic had publicly denied any personal financial ties to the now-defunct crypto project.
However, the SEC's disclosures contradicted his claims, listing him as one of Terraform Labs' initial investors.
The revelation has raised questions about Spajic's transparency and potential conflicts of interest, further intensifying scrutiny of the embattled crypto firm.
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