Terraform
Labs’ Founder, Do Kwon, has opposed attempts by the US Securities Exchange
Commission (SEC) to extradite him for questioning regarding the collapse of
Terra LUNA and the stablecoin TerraUSD.
Kwon’s defiance
became evident with a recent court filing, submitted in the US District Court
for the Southern District of New York, where he seeks to dismiss the SEC’s
request for his testimony in the US. His legal team said such a step is
impossible due to Kwon’s detention in Montenegro. Additionally, the
filing states that compelling him to provide a written testimony would infringe
upon his rights under the laws of the US.
In a statement
within the filing, Kwon’s lawyers said: “The SEC’s motion seeks leave to
take the deposition of Defendant Do Kwon in the United States before October
13, 2023, even though the SEC knows that Kwon is detained in Montenegro
with no scheduled release or extradition date. The motion should be denied
because it would be impossible for Kwon to appear for such a deposition.”
The SEC’s
legal pursuit of Terraform Labs dates back to February when they filed a
lawsuit accusing the company of misleading investors regarding the safety of
investing in TerraUSD. Investors were assured that TerraUSD would maintain its
peg to the US dollar through a complex mint-burn system involving its sister
coin, LUNA. However, the downfall of both TerraUSD and LUNA in May 2022 resulted
in an estimated loss of $50 billion to investors.
Currently,
the US and South Korea are seeking the extradition of Kwon. In March,
Montenegro’s Minister of Justice, Marko Kovac, revealed that a judge will
ultimately determine whether Kwon will be extradited to the US or South Korea,
Bloomberg reported.
Kwon, who
served as the CEO of Terraform Labs, was hit with criminal charges in March by federal prosecutors in New York. The charges were brought against him just hours
after his arrest in Montenegro.
Do Kwon Faces
Eight Counts of Charges in the US
The federal
court in the Southern District of New York officially filed eight counts of
charges against Kwon, all related to his alleged involvement in the ill-fated
stablecoin
