Home » Finance » Investing » Extradited South Korean crypto ‘genius’ Do Kwon in court to face US charges

Extradited South Korean crypto ‘genius’ Do Kwon in court to face US charges

by admin
0 comment 2 views

A fugitive “genius” who went on the run after his crypto company collapsed, wiping out $64 billion in investor assets, has appeared in court.

The South Korean co-founder of Terraform Labs appeared in a New York court on Thursday to face fraud charges stemming from the multibillion-dollar collapse of his cryptocurrency company.

Do Hyeong Kwon, 33, was extradited to the United States from Montenegro on Tuesday.

Kwon, the former chief executive of Terraform, is accused of deceiving investors to fraudulently inflate the value of his firm’s cryptocurrencies.

“Do Hyeong Kwon will now be held accountable in an American courtroom for … his elaborate schemes involving Terraform’s cryptocurrencies, which resulted in over $US40 billion ($64 billion) in investor losses,” Attorney-General Merrick Garland said in a statement.

Extradited South Korean crypto ‘genius’ Do Kwon in court to face US charges

Montenegrin police escort Do Kwon outside court in Podgorica. Picture: Savo Prelevic/AFP

US Attorney Daniel Gitner said the May 2022 crash of Terraform’s cryptocurrencies “erased over $US40 billion in investor assets, causing devastating losses to countless investors in the United States and around the world”.

Kwon, who is also wanted in South Korea, is charged in the United States with commodities fraud, securities fraud, wire fraud and money laundering and faces up to 130 years in prison if convicted of all charges.

The crypto tycoon was arrested in March 2023 at an airport in Podgorica, the Montenegrin capital, while preparing to board a flight to Dubai, in possession of a fake Costa Rican passport.

Extradited South Korean crypto ‘genius’ Do Kwon in court to face US charges

Kwon was the co-founder and CEO of Terraform Labs. Picture: Woohae Cho/Bloomberg

Before his arrest in the tiny Balkan nation, he had been on the run for months, fleeing South Korea and later Singapore.

Montenegro deported Kwon’s business partner — identified only by his initials J.C.H. — to South Korea in early February.

Terraform created a cryptocurrency called TerraUSD that was marketed as a “stablecoin”, a token that is pegged to stable assets such as the US dollar to prevent drastic fluctuations.

Kwon successfully marketed it as the next big thing in crypto, attracting billions in investments and global hype.

Media reports in South Korea described him as a “genius”. But despite billions in investments, TerraUSD and its sister token Luna went into a death spiral in May 2022.

Experts said Kwon had set up a glorified pyramid scheme, in which many investors lost their life savings.

He left South Korea before the crash and went on the run.

Cryptocurrencies have come under increasing scrutiny from regulators after a string of controversies in recent years, including the high-profile collapses of exchanges.

You may also like

Leave a Comment

About Us

Our website is your guide to the world of Australian finance and business. We deliver up-to-date economic news, market analysis, stock trends, and insights into property, investments, and banking.

Feature Posts

Newsletter

Subscribe my Newsletter for new blog posts, tips & new photos. Let's stay updated!

@2024 – All Right Reserved. ABC Australia – Australian financial and business news.

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Accept No accept

Are you sure want to unlock this post?
Unlock left : 0
Are you sure want to cancel subscription?