July 19, 2024

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Do Kwon, known as South Korea’s ‘crypto crash king,” was imprisoned for “TerraUSD”

Do Kwon, the CEO of a cryptocurrency company responsible for the collapse of the “TerraUSD” and Luna tokens, has been sentenced to a four-month prison term in Montenegro due to his involvement in forging official documents. Mr. Kwon’s arrest took place in March at Podgorica Airport while he was preparing to board a flight to Dubai. Notably, he is also confronting charges in the United States and South Korea regarding the decline of the two digital tokens last year.

In a similar vein, Han Chang-joon, the former finance officer of Mr. Kwon’s company Terraform Labs, has received an identical four-month jail sentence for his complicity in the same offence. Both Mr. Kwon and Mr. Han initially pleaded not guilty during their initial court hearing in May.

The court has made it clear that the imposed sentences would account for the duration of time already spent in custody following their arrest in March. Furthermore, they possess the right to appeal the verdict within eight days of receiving written notification from the court.

In February, US regulatory authorities levelled charges against Mr. Kwon and Terraform Labs, accusing them of orchestrating a fraudulent scheme involving crypto asset securities amounting to billions of dollars. The US Securities and Exchange Commission (SEC) alleged that they had failed to provide the public with accurate and comprehensive information regarding Luna and TerraUSD.

Last year, a South Korean court issued arrest warrants for Mr. Kwon and five other individuals connected to the case. Prosecutors maintained that Terraform Labs, which is registered in Singapore, had violated capital market regulations.

It is worth mentioning that Montenegro lacks extradition agreements with the United States and South Korea, rendering it improbable for Mr. Kwon to face trials in those nations.

The collapse of the TerraUSD stablecoin and its associated Luna token had a profound impact on cryptocurrency markets in May 2022.