A South Korean man linked to a $40 billion crypto crisis has been extradited to the US.
Do Kwon, head of Terraform Labs, oversaw two cryptocurrencies—TerraUSD and Luna—that collapsed in 2022, triggering a market-wide sell-off.
US authorities accuse Kwon of causing the coins’ failure, charging him with “orchestrating multi-billion dollar crypto fraud.”
Kwon fled South Korea after an arrest warrant was issued. He was caught in Montenegro, where he faced a lengthy legal battle before extradition.
In March 2023, Montenegrin authorities arrested him at an airport for attempting to travel with forged documents. A court convicted him, delaying extradition as Montenegro lacks treaties with the US or South Korea, which also sought his return.
The Montenegrin Ministry of Justice approved the US extradition in December 2024, ending an 18-month legal process.
Terraform Labs and the Crypto Collapse
Terraform Labs became famous in 2021 as its coins Luna and TerraUSD gained immense popularity.
Supporters of Luna called themselves “Lunatics,” and Kwon became their unofficial leader. By May 2022, the company’s fortunes reversed dramatically. Terraform lost over 99% of its value in just 48 hours.
Investors panicked, withdrawing funds from other cryptocurrencies and triggering a market-wide collapse. The crash wiped out an estimated $400 billion from the crypto market, including significant losses in Bitcoin’s value.
Despite this turmoil, Bitcoin has since recovered. In December 2024, its value briefly exceeded $100,000 per coin.
Terraform Labs declared bankruptcy in January 2024, sealing its fate as a cautionary tale in crypto history.