Han Chang-joon, the former financial officer of Terraform Labs, has been extradited to South Korea to face charges related to the company’s collapse. However, the fate of Do Kwon, the Terraform founder, remains uncertain as both the US and South Korea vie for his extradition, leaving him in limbo and the full picture of accountability incomplete.
Facing Financial Fraud Charges
Montenegro authorities extradited Han Chang-joon, the former financial officer of Terraform Labs, back to South Korea today, marking a remarkable twist in the ongoing saga surrounding the collapsed cryptocurrency project. This news comes almost a year after his arrest alongside Terraform founder Do Kwon at Podgorica Airport in March 2023.
While Han faces criminal charges in South Korea related to financial fraud and investment market manipulation, Do Kwon’s extradition remains undecided. Both the United States and South Korea have submitted extradition requests for the Terraform founder, leaving his fate hanging in the balance.
Handed Over to South Korean Authorities
Han Chang-joon, former financial officer of Terraform Labs, has been extradited to South Korea after completing his prison sentence in Montenegro. He and Terraform Labs co-founder Do Kwon were arrested in March 2023 while attempting to travel with fake documents, bringing a six-month international manhunt to an end.
The Montenegrin police announced the extradition, revealing that Han Chang-joon had been “handed over to” South Korean authorities. The country’s Ministry of Justice made the decision, allowing South Korean authorities to initiate criminal proceedings against Han for several offenses related to fraud in financial investment services, investments, and the capital market. These charges carry the potential for life imprisonment in South Korea.
Do Kwon’s Fate in The Balance
Goran Rodic, the lawyer representing Kwon and Han, stated, “We are still waiting for the decision about Do Kwon, following our appeal.” US and South Korean prosecutors have sought Kwon’s extradition in connection to the $60 billion collapse of the algorithmic stablecoin Terra in 2022.
Han’s extradition follows the completion of his four-month prison sentence in Montenegro for attempting to travel with forged documents.
Terraform Labs, facing financial challenges, filed for Chapter 11 bankruptcy in the US in January. The company has not immediately responded to requests for comment.
An Industry Implosion
The Terra saga began in 2018 when Do Kwon founded Terraform Labs with Daniel Shin. Over four years, the company and its algorithmic stablecoin, TerraUSD, gained popularity. However, in May 2022, Terra depegged from the dollar and experienced a collapse, triggering a series of industry implosions, including the liquidations of crypto fund Three Arrows Capital and exchange FTX.
In September 2022, a South Korean court issued an arrest warrant for Kwon and five others, accusing them of violating Korean capital markets laws. Interpol subsequently issued a red notice for Kwon’s arrest. Investigators began searching for Kwon in January 2023 after news reports suggested he was in Serbia.
In March, Kwon and Han were arrested in Montenegro for attempting to use falsified Costa Rican passports to travel to Dubai. Montenegrin authorities charged them with forgery and traveling with false passports. In June, a Montenegrin court convicted Kwon of using forged passports. Kwon appealed the verdict, but the appeal was rejected in November.
The extradition of Han marks a step forward in holding individuals accountable for the Terraform collapse, which resulted in billions of dollars in losses for investors. However, Do Kwon’s unclear fate leaves questions lingering about the full extent of legal repercussions for those involved. This case also highlights the complex international legal landscape surrounding cryptocurrency and the challenges of pursuing justice in decentralized systems.