About Do Kwon
Do Kwon, cofounder of Terraform Labs, pleaded not guilty in a Montenegro court in September 2023 to charges of using forged passports from Belgium and Costa Rica, according to Bloomberg News. His defense lawyer proposed releasing him on bail of 400,000 euros, but the prosecutor objected, arguing Kwon and former CFO Han Chang-jun had financial means and no interest in remaining in Montenegro. Kwon had been arrested in Montenegro in March 2023 after South Korea issued an arrest warrant for him in September 2022. The U.S. Securities and Exchange Commission (SEC) charged Terraform Labs and Kwon in February 2023 with defrauding investors, alleging they promoted their crypto by claiming the tokens would increase in value and that Kwon secretly arranged for a third party to purchase massive amounts of TerraUSD (UST) to restore its dollar peg in May 2021, while publicly touting the restoration as a triumph of decentralization.
In interviews following the collapse of the Terra ecosystem, Kwon has characterized the event as a "massive market failure" rather than fraud, stating that he believed in the stability of UST and that his statements led users without the tools to understand the complex economic mechanisms to gain confidence in a system that ultimately failed. He has said he went into a "state of shock" when the collapse began and that he tried to help community members find jobs and funding. Kwon has maintained that the Luna Foundation Guard only held 313 Bitcoin and has denied allegations of being on the run, though he has not disclosed his location. He has stated he plans to continue building in crypto, saying, "I am but 31, and I would still love to contribute."
Source: AI-verified profile updated from Do Kwon's recent appearances.
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Terraform Labs CEO Do Kwon pleaded not guilty to forged passport charges. Terraform Labs co-founder Do Kwon pleaded not guilty to allegedly using false passports from Belgium and Costa Rica on Thursday in a Montenegro court, according to Bloomberg News. Kwon had been on the run for months after the demise of Terraform Labs, the company behind the algorithmic stablecoin TerraUSD that fell dramatically last year. Both Kwon and the company's former Chief Financial Officer Han Chang were accused of forgery by Montenegro prosecutors last month. Defense lawyer Branko Angelic proposed freeing both of them on bail of 400,000 euros each, but the prosecutor strongly objected, saying that both had financial means and no interest in staying in Montenegro, according to Bloomberg. Search warrants for his arrest were issued in South Korea in September, and Kwon was subsequently arrested in March. Using forged documents can be punishable by as many as five years in prison under Montenegrin law, according to Bloomberg. The collapse of TerraUSD had been the largest algorithmic stablecoin before it crashed almost a year ago, causing billions of dollars to be wiped out. TerraUSD is an algorithmic stablecoin that uses market incentives through algorithms to maintain a stable price. The stablecoin was also paired to a governance token called Luna, which subsequently fell with it. Global search: the US and South Korea have requested the extradition of Kwon and Changjun, a decision that will be up to a local judge there in Montenegro. The US Securities and Exchange Commission charged Terraform Labs and Kwon in February for defrauding investors. The agency said Kwon and Terraform promoted their crypto by repeatedly claiming that the tokens would increase in value. The complaint also went into detail about other happenings at the firm, including that TerraUSD had fallen from its peg before in May 2021. Two years ago, TerraUSD dropped below its one dollar peg, and Kwon secretly discussed with a third party that the third party would purchase massive amounts of USD to restore the one dollar peg. The SEC said when TerraUSD was returned to a dollar value, Kwon and the company publicly and repeatedly touted the restoration of the one dollar peg as a triumph of decentralization, among other reasons, while omitting the real reason the peg was restored through a third party, the SEC said.
