Montenegro’s justice minister has approved the extradition of South Korean cryptocurrency entrepreneur Do Kwon to the United States, clearing the way for him to face fraud charges over the collapse of TerraUSD and Luna. The decision follows more than 18 months of legal back-and-forth and ends a contested fight over where one of crypto’s highest-profile figures should be tried.
The justice ministry said Bojan Bozovic issued a decision approving the extradition of the accused, Kwon Do Hyung, to the US. It said the majority of the legal criteria favoured the American request. Kwon had also consented to extradition to both South Korea and the United States, according to the statement.
Kwon’s case stems from the implosion of the two tokens associated with Terraform Labs. TerraUSD and Luna lost about $40 billion from investors and helped trigger turmoil in wider crypto markets. The US and South Korea had both sought his extradition for months, arguing that fraud was central to the failure of the company behind the tokens.
The collapse was one of the defining crypto events of 2022. TerraUSD was meant to be a stablecoin, but it and Luna entered a death spiral in May of that year, dragging other major cryptocurrencies, including Bitcoin, down with them. In February, US regulators charged Kwon and Terraform Labs with orchestrating a multi-billion-dollar crypto-asset securities fraud.
The SEC said Terraform and Kwon failed to provide full, fair and truthful disclosure for a range of crypto-asset securities, especially Luna and TerraUSD. Kwon was accused of repeatedly claiming the tokens would increase in value while misleading investors about TerraUSD’s stability.
Montenegro’s role in the saga became unavoidable after Kwon was arrested in March 2023 while trying to board a flight to Dubai at Podgorica Airport. He had already become the subject of an Interpol red notice in 2022 and had moved through Singapore and Serbia after his business collapsed.
Because Montenegro does not have extradition treaties with the US or South Korea, the case had to be settled through domestic courts and ministerial decisions. That process produced multiple reversals before the latest ruling. Kwon had previously been sentenced to four months in prison in Montenegro for forging official documents.
The extradition decision matters beyond one defendant. It is another sign that governments are still willing to treat major crypto failures as serious legal and financial crimes rather than merely market mishaps. For investors who lost money in Terraform’s collapse, the ruling brings the prospect of a US criminal case a step closer.
It also closes one chapter in a drawn-out international contest over jurisdiction. With Montenegro now siding with the US request, Kwon’s next legal battle is likely to unfold in American courts, where prosecutors have already framed the Terra collapse as a major fraud rather than an unfortunate market accident.
