Du Kwon, the South Korean entrepreneur accused of orchestrating a $40 billion cryptocurrency collapse, has been extradited to the United States, as reported by the BBC.

Background on the Terraform Collapse and Legal Proceedings

Do Kwon founded Terraform Labs, a company that launched the algorithmic stablecoin TerraUSD (UST) and its companion token, Luna. These assets gained widespread popularity, placing Terraform Labs at the forefront of decentralized finance.

In May 2022, (UST) lost its peg to the U.S. dollar due to design flaws and market instability. This triggered a catastrophic decline in Luna's value, erasing $45 billion in market capitalization in just days, leaving investors with massive losses.

The aftermath of this collapse implicated Kwon in a global controversy. South Korean authorities issued an arrest warrant, accusing him of violating capital markets law. Interpol followed with a Red Notice, while Kwon reportedly evaded authorities by moving between countries, including Singapore and Serbia.

In March 2023, Kwon was arrested in Montenegro for attempting to travel with forged documents. A four-month prison sentence for document forgery was upheld by Montenegro’s highest court. Meanwhile, South Korea and the United States competed for his extradition to face charges, including securities fraud and wire fraud related to the Terraform debacle. 

By December 2024, Montenegro's Constitutional Court dismissed Kwon’s appeal against extradition. The justice minister subsequently approved his transfer to U.S. custody, where he now faces legal proceedings.