Montenegro Court Frees Do Kwon, With A Guarantee Of IDR 6.4 Billion

Terraform Labs founder, Do Kwon, has been arrested by the Montenegro police. (Photo; Doc. TechResearcho)

JAKARTA - A court in Montenegro agreed on Friday May 12 to release Do Kwon, a cryptocurrency entrepreneur accused of billions of dollars in fraud in the United States, with a guarantee of 400,000 euros (IDR 6.4 billion), awaiting trial on local charges.

Do Kwon, a South Korean national, is former CEO of Terraform Labs based in South Korea, the company behind the stablecoin TerraUSD that collapsed in May 2022 and rocked the cryptocurrency market.

After being arrested in Montenegro in March, the US District Court in Manhattan announced eight charges against Do Kwon over securities fraud, wire fraud, commodity fraud, and conspiracy.

He was detained alongside Han Chang-Joon, a former Terraform Labs financial officer, who will also be released on a guarantee of 400,000 euros. Both were accused of falsifying official documents and courts in Podgorica ordered them to be detained 30 days before the trial.

The two defendants will remain under house arrest and under police control, the Constitutional Court in Montenegro's capital Podgorica said in a statement.

"The court... concluded that the possibility of losing a guarantee of 400,000 euros each was quite successful in scaring them not to want to run away," the statement said.

The two defendants, who at Thursday's hearing denied wrongdoing on charges pressured by prosecutor Montenegro, told the court they had millions of property and guarantees would be posted by their wives, the statement said.

Montenegro police arrested Do Kwon and Chang-Joon at Podgorica airport as they tried to board a plane to Dubai.

Police later said they had found a falsified Costa Rica passport, a set of Belgian passports, laptop computers, and other devices in their trunk.

South Korean and US authorities are seeking extradition from Do Kwon and Chang-Joon as well as computer submissions.