Crypto entrepreneur Do Kwon pleaded not guilty in a court in Montenegro, where he was detained on an international warrant and charged by local authorities with using forged travel documents.
(Bloomberg) — Crypto entrepreneur Do Kwon pleaded not guilty in a court in Montenegro, where he was detained on an international warrant and charged by local authorities with using forged travel documents.
The Terraform Labs co-founder and its former chief financial officer, Han Chang-joon, who also pleaded not guilty, were caught at the airport in Montenegro’s capital Podgorica in March when they tried to board a private jet to fly to Dubai after months as fugitives.
The men’s first hearing at the city’s Basic Court on Thursday comes almost exactly a year after the implosion of TerraUSD, an algorithmic stablecoin, sparked a criminal investigation in their native South Korea.
Defense lawyer Branko Andjelic proposed freeing them on bail of 400,000 euros ($437,000) each, and proposed for them to be held under house arrest in his girlfriend’s flat.
Prosecutor Haris Sabotic strongly objected, saying the two have ample financial means, but “zero interest” in staying in Montenegro.
Judge Ivana Becic didn’t say when she’ll rule on bail, but the next hearing will be June 16.
If bail is granted, “I will not hide, I agree to security measures, I will show up when requested,” Kwon told the court in English.
Wearing a dark zipped jacket and looking grim, he said he would have provided more detail about his assets and claimed he would even give his account numbers if media weren’t present in the room.
Most of the assets he owns are in “volatile and liquid” form, Kwon said, adding it’s hard to estimate their market value.
He did say that he and his wife jointly own a flat in Seoul worth roughly 3 million euros.
Kwon has been charged by US prosecutors with orchestrating a years-long cryptocurrency fraud that wiped out at least $40 billion in market value, and faces similar charges in South Korea.
Both countries are seeking Kwon’s extradition from Montenegro, where justice officials said they may consider handing him over only after the local criminal proceedings are completed.
The two were found carrying Belgian and Costa Rican travel documents, in addition to at least one passport issued by their native South Korea, Montenegrin officials said in March.
The Belgian and Costa Rican passports were falsified, according to Interpol and Montenegro. Both men said in court the Costa Rican passports they tried to use were valid.
Using forged documents is punishable by as long as five years in prison under Montenegrin law.
That collapse TerraUSD, and its sister token Luna, accelerated a broader $2 trillion downturn in the crypto market.
Officials in South Korea say the Terra project Kwon helped create was a “fabrication” from its inception as the algorithm that helped keep TerraUSD at a stable price was impossible to get right.
Prior to the TerraUSD collapse, those involved in the project took 463 billion won ($350 million) in profit, South Korean officials said last month.
The other Terraform Labs co-founder, Daniel Shin, was indicted in April along with nine others on charges that include violation of capital markets law.
South Korean prosecutors have frozen about 233 billion won of Kwon’s assets, including his house in Seoul and an imported luxury car, along with securities, bank deposits and cryptocurrencies, Korean Economic Daily reported on Thursday.
–With assistance from Irina Vilcu and Andrea Dudik.
(Recasts with details.
A previous version of this story corrected spelling of Korea in last paragraph.)
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