South Korean Terra investor community wants Do Kwon sent to US, not Korea

A group of South Korean investors in Terra-Luna, who claim to be victims of its collapse, released a statement on Friday advocating for the extradition of Terraform Labs co-founder Do Kwon to the U.S. instead of Korea. This follows Thursday’s high court decision in Montenegro to extradite Kwon to South Korea.

The statement, posted on a public online forum hosting the community for Terra-Luna victims with over 2,700 members, claimed that Kwon may not receive the appropriate amount of punishment he allegedly deserves. The U.S. Department of Justice said that it will continue to pursue the extradition of Do Kwon from Montenegro, according to a Bloomberg report on Friday.

“Even if [Kwon] is sentenced in the first trial in South Korea, where rules on punishing crypto crimes have not been established, it is highly likely that the punishment would be reduced significantly in appeals and [Kwon] would be released without proper punishment,” the statement said.

South Korea’s maximum sentence for financial criminals typically ranges from 30 to 40 years, according to local news reports. The U.S., however, follows a principle where the court can impose consecutive sentences for each crime a defendant is found guilty of. Hence, the potential maximum sentence Kwon could face is deemed higher in the U.S., the statement claimed.

For example, Sam Bankman-Fried, the leader of collapsed FTX exchange who was found guilty last year of defrauding investors, was given a suggested sentence of 100 years from the probation office.

“If Kwon Do-hyeong is released from prison after light punishment in Korea, the victims, including myself, will suffer for the rest of their lives,” said the victims in the statement, referring to the Terra co-founder by his full Korean name. “I've been waiting for years, but I don't live expecting Kwon Do-hyeong to compensate for the damage.” 

Terraform Labs’ algorithmic stablecoin Terra and sister cryptocurrency Luna crashed in May 2022, wiping out over $40 billion worth of market capitalization in a matter of days. Since then, U.S. and South Korean authorities have sought Kwon and Terraform Labs on charges including fraud and violations of securities laws.

Kwon, who has been a fugitive since the collapse, was arrested in Montenegro last March for attempting to travel with fake documents.