After receiving a 15-year prison sentence last week, Do Kwon, co-founder and former CEO of Terraform Labs, could face another big sentence in a potential second trial if he is extradited to his native South Korea.
Tira Do Kwon may face a second trial
South Korean media confirmed on Monday that the legal troubles faced by Terraform Labs co-founder Kwon Do-hyung, also known as Do Kwon, may not be over, despite him recently being sentenced to more than a decade in prison in the United States.
According to a report by The Korea Times, government officials and prosecutors stated that the cryptocurrency entrepreneur could face a second trial and a significant prison sentence in South Korea if he is extradited in the future.
On December 11, Kwon received a 15-year prison sentence for his involvement in the $40 billion collapse of the TerraUSD (UST) stablecoin in 2022. Notably, he first pleaded not guilty in January to a nine-count indictment that charged him with securities fraud, wire fraud, commodity fraud, and conspiracy to commit money laundering.
However, he changed his position in August, pleading guilty to conspiracy to defraud and wire fraud and apologizing for his actions. As Bitcoinist reported, the Terra founder previously requested a maximum five-year prison sentence at the end of November, arguing that he had “suffered greatly for his crimes,” and that anything longer than that was “far too great to achieve justice.”
Meanwhile, prosecutors asked for a 12-year prison sentence for the Terraform Labs co-founder’s fraudulent actions earlier this month. US District Judge Paul Engelmayer highlighted the seriousness of his case last Thursday, stressing that the sentence he was given was the “lowest” he could impose.
Five years would be so unreasonable as to require reversal on appeal. Others must be deterred. People are watching this [live]. There will be entrepreneurs in the future. This case will serve as a reminder of the bad breakage and what’s going on.
South Korean ruling could double US punishment
The Korea Times noted that the Korean citizen is widely expected to apply to the International Prisoner Transfer Program after serving half of his 15-year sentence, as US prosecutors agreed not to oppose such a request as part of a plea deal in August.
This opens the possibility of Kwon’s extradition to his home country and a separate trial on multiple counts of capital markets law violations, which could result in additional punishment.
With an estimated more than 200,000 victims in South Korea, more than $204 million in total losses, and ten alleged accomplices already on trial in the country, authorities stressed that “prosecuting Kwon locally would best serve efforts to compensate local victims.”
“A guilty verdict in Korea could result in a prison sentence of more than 30 years,” a senior prosecutor reportedly said on Monday.
As the report noted, the Financial Crimes Unit of the Seoul South District Prosecutor’s Office obtained an arrest warrant for Kwon in September 2022. In March 2023, Montenegrin authorities arrested him along with Han Chang-jun, a former financial officer at Terraform Lab, for attempting to travel with forged documents.
It is worth noting that the crypto businessman was detained in Montenegro for more than a year and a half and faced a four-month prison sentence, and later received an additional two months at the request of the United States and South Korea, which sought to bring him to justice in both jurisdictions.
The two countries began an extensive battle to bring Kwon to trial, with Montenegrin authorities initially agreeing to Kwon’s extradition request submitted by South Korea. However, he was extradited to the United States on December 31, 2024, after the Montenegrin Ministry of the Interior signed the application, delaying the trial in his home country.
Total crypto market capitalization is at $2.91 trillion on the one-week chart. Source: TOTAL on TradingView
Featured image from Unsplash.com, chart from TradingView.com
Editing process Bitcoinist focuses on providing well-researched, accurate, and unbiased content. We adhere to strict sourcing standards, and every page is carefully reviewed by our team of senior technology experts and experienced editors. This process ensures the integrity, relevance, and value of our content to our readers.
