The Trial of Do Kwon in the United States has Been Postponed

The trial of Do Kwon in the United States has been postponed

The trial of the former CEO of Terraform Labs, Do Kwon, regarding allegations from the U.S. Securities and Exchange Commission (SEC), has been postponed from the initially scheduled date of January 29 to March 2024.

The trial of former Terraform Labs CEO Do Kwon, originally scheduled for January 29, has been postponed to March 25. Judge Jed Rakoff said Do Kwon had agreed to be extradited from Montenegro, where he is currently being held, but there was no guarantee he would be released in…

— Wu Blockchain (@WuBlockchain) January 17, 2024

In February 2023, the SEC filed a lawsuit against Do Kwon, holding him responsible for the collapse of the crypto projects LUNA – UST in May 2022, resulting in a loss of $60 billion in market capitalization for the cryptocurrency market.

Following the lawsuit, Do Kwon was arrested in Montenegro in March of the same year for using a forged passport. After spending four months in detention, he continued to be held in Montenegro as local authorities have not made a decision on extradition.

In the latest development, Do Kwon’s lawyer announced that while he has agreed to be extradited to the U.S. for trial, there is no assurance that he will be released in time to participate in the trial, even with the postponement to March.

Nevertheless, Judge Jed Rakoff has accepted the trial’s rescheduling to March 25, 2024.

In a December court session, Judge Rakoff sided with the SEC, acknowledging their argument that LUNA, UST, and some other tokens in the Terra ecosystem are securities. Consequently, Terraform Labs violated the law by selling these tokens without registering with the SEC.

The SEC’s charges against Do Kwon include fraud in the sale of securities, fraud related to the sale of securities, selling unregistered securities, selling contract for differences in securities with unqualified individuals, and handling transactions of contract for differences in securities with unqualified individuals

Apart from Do Kwon, two other prominent figures in the cryptocurrency industry are awaiting trial in the U.S., namely former Binance CEO Changpeng Zhao (scheduled for February 23, 2024) and former FTX CEO Sam Bankman-Fried (scheduled for March 28, 2024).