Montenegrin Justice Minister Marko Kovac said on March 29 that both South Korea and United States are requesting the extradition of Do Kwon, the former CEO and co-founder of cryptocurrency company Terraform Labs, who is suspected in the loss of investments worth more than $40 billion.
Do Kwon and his business partner, Hon Chang-joon, were arrested in Montenegro on March 23 while trying to flee to Dubai with falsified documents, according to the Justice Ministry.
Kovac said South Korea had requested the extradition of both Do Kwon and Hon Chang-joon.
He said that United States also requested Do Kwon's extradition.
"The existence of the international warrant regarding these two persons and the submitted request for extradition creates the ground for the extradition procedure to be initiated," Kovac told a news conference in Podgorica on March 29.
He did not clarify to which of the two countries they will be extradited, adding the ministry will inform the public if any other country sends an extradition request.
"In case we receive several extradition requests, I would like to say that determining which state they will be extradited to will be based on several factors, given the severity of the criminal offense committed, the location, and the time when the criminal offense was committed, the order in which we received the request for extradition, and several other factors," Kovac said.
He added that South Korea and the United States had also requested the laptops seized from the two suspects.
On March 24, Montenegro charged the two with forgery after their arrest.
The two men were taken into custody because they are considered a flight risk, authorities said. The suspects can be detained for a maximum of 30 days, a Podgorica court said.
Do Kwon is wanted by the United States, South Korea, and Singapore for what the U.S. Securities and Exchange Commission (SEC) calls "orchestrating a multibillion-dollar crypto-asset securities fraud."
"We allege that Terraform and Do Kwon failed to provide the public with full, fair, and truthful disclosure as required for a host of crypto-asset securities, most notably for Luna and Terra USD," SEC Chairman Gary Gensler said in a statement in February.
Terra USD was a crypto-asset security referred to as an "algorithmic stablecoin" that supposedly maintained its peg to the U.S. dollar by being interchangeable with Luna, another of Kwon's crypto-asset securities, the SEC said.
"We also allege that [Terraform and Kwon] committed fraud by repeating false and misleading statements to build trust before causing devastating losses for investors," he added.
Many investors lost their life savings when Luna and Terra USD collapsed, falling to a value of near zero. The fallout from the collapse of Terraform Labs also affected the wider cryptocurrency market.