Do Hyeong Kwon, the former CEO of Terraform Labs PTE Ltd., has been extradited from Montenegro to the United States to face federal fraud charges. The indictment alleges that Kwon engaged in schemes to deceive investors and inflate the value of Terraform's cryptocurrencies, resulting in over $40 billion in losses.
Kwon arrived in the U.S. on December 31, 2024, and appeared before U.S. Magistrate Judge Robert W. Lehrburger in Manhattan. His case is assigned to U.S. District Court Judge John P. Cronan, with an initial conference scheduled for January 8.
Attorney General Merrick B. Garland stated, "Do Hyeong Kwon will now be held accountable in an American courtroom for, as alleged in court documents, his elaborate schemes involving Terraform’s cryptocurrencies." He highlighted the Justice Department's international partnerships that facilitated Kwon's extradition despite attempts to evade capture.
Daniel M. Gitner, Attorney for the Southern District of New York, noted that a federal grand jury indicted Kwon for misleading investors and laundering proceeds from his crimes. Gitner emphasized the significant impact on investors worldwide due to Terraform's cryptocurrency crash in May 2022.
James E. Dennehy of the FBI New York Field Office commented on Kwon's alleged fraudulent activities: "For at least four years, Kwon allegedly played puppet master to maintain this crafted illusion and ensnare investors."
The indictment outlines various misrepresentations by Kwon regarding Terraform's products and technologies, including claims about their stability and decentralization which were allegedly false.
Kwon faces multiple charges including commodities fraud, securities fraud, wire fraud, conspiracy charges related to these offenses, and money laundering conspiracy. If convicted on all counts, he could face up to 130 years in prison.
The FBI is leading the investigation with support from several agencies including Interpol and Montenegrin authorities during extradition proceedings.
Assistant U.S. Attorneys Jared Lenow, Kimberly Ravener, and Andrew Thomas are prosecuting the case while emphasizing that an indictment is merely an allegation and defendants are presumed innocent until proven guilty.