Former Terraform Labs CEO won’t be extradited to US, South Korea yet: Bloomberg

Last week, WSJ reported that Montenegro planned to extradite Kwon to the US rather than South Korea

article-image

JLStock/Shutterstock modified by Blockworks

share

Montenegro is slowing its roll on extraditing former Terraform Labs CEO Do Kwon, according to Bloomberg.

Last week, the Wall Street Journal reported that Montenegro planned to extradite the former executive to the United States over his home country, South Korea. Kwon faces charges in both countries. 

The extension, Bloomberg reported, came at the request of both the US and South Korea. A court in Podgorica ruled that the term in custody would be extended to February. Without an extension, the term would have ended Friday.

Kwon has been in Montenegro since March, when he was first arrested for allegedly using falsified paperwork. He was sentenced to prison in June.

Read more: Terraform Labs founder Do Kwon faces US extradition: WSJ

The court spokesperson, Marija Rokovic, told Bloomberg that Kwon’s defense team appealed the extradition decision, which will now be heard by an appellate court in Podgorica. The High Court previously ruled that extradition could take place, and left it to the justice minister of Montenegro to decide where to extradite Kwon.

The US Securities and Exchange Commission has an open case against both Kwon and his former company, Terraform Labs. The suit was filed in February after the collapse of algorithmic stablecoin TerraUSD (UST), which led to a $40 billion crypto crash. UST’s failure also helped lead to multiple bankruptcies from the likes of Voyager and Celsius, both of which had exposure to the stablecoin.

The SEC alleges that Terraform and Kwon offered and sold unregistered securities. Kwon, in South Korea, faces fraud and capital markets violations charges.

Terraform and the SEC are currently debating whether Judge Jed Rakoff or a jury should determine if the alleged securities Terraform and Kwon offered fall under the US law’s definition of securities.

The SEC is in favor of Judge Rakoff issuing a summary judgment on the status of the alleged securities instead of letting a jury decide. The defense, however, would rather let the jury decide if the tokens pass the Howey test.


Get the news in your inbox. Explore Blockworks newsletters:

Tags

Decoding crypto and the markets. Daily, with Byron Gilliam.

Upcoming Events

Old Billingsgate

Mon - Wed, October 13 - 15, 2025

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

recent research

Research Report Templates.jpg

Research

Figure, founded by former SoFi CEO Mike Cagney, has emerged as a leader in onchain RWAs, with ~$17.5B publicly tokenized. The platform’s ecosystem volume is growing ~40% YoY as it expands beyond HELOCs into student loans, DSCR loans, unsecured loans, bankruptcy claims, and more. Operationally, Figure cuts average loan production cost by ~93% and compresses median funding time from ~42 days to ~10, creating a durable speed-and-cost advantage.

article-image

In bonds, stablecoins and billionaires, a reminder of what makes crypto special

article-image

21Shares exec says CPI and PPI data supports a Fed rate cut, with market leaning toward a 25bps decrease

article-image

The Ethereum co-founder suggested LINEA holders would be eligible for other airdrops in cryptic tweet

article-image

The layer-2’s biggest release yet brings benefits — but a post-upgrade outage caused a chain reorg

article-image

Crypto is shifting into risk-on mode — pump.fun dominates meme activity, while Lido leans on treasury maneuvers

article-image

If the president breaks the Fed, he’ll own the budget problems