The high court in Montenegro has overturned a previous decision by a lower court that would have granted bail to Do Kwon, the founder of Terraform Labs. Bloomberg was the first to report on this development.
As a result of the high court ruling, Kwon will remain in jail until the Basic Court in Montenegro reevaluates the case in light of this decision. A court spokesperson confirmed this information to Bloomberg.
The high court’s decision comes approximately two weeks after the Basic Court in Montenegro had agreed to release Kwon and his former colleague, Chang-joon Han, on bail.
During the initial hearing earlier this month, Kwon pleaded not guilty to charges of forging his passport and travel documents. The defense lawyer representing Kwon and Han requested their release on bail, with a proposed amount of €400,000 ($437,000) each, along with house arrest under police supervision.
Kwon and Han were arrested at Podgorica airport, the capital of Montenegro, in March while attempting to fly to Dubai.
A year ago, Terraform’s stablecoin TerraUSD (UST), which was an algorithmic stablecoin linked to its sister coin Luna, experienced a loss of its $1 peg. This resulted in a significant market value decline of approximately $40 billion and caused the collapse of numerous cryptocurrency firms.
Both U.S. and South Korean authorities are seeking Kwon’s extradition to face charges in their respective countries. If Kwon is found guilty of falsifying documents in Montenegro, he may have to serve a prison sentence there before being extradited to the U.S. or South Korea. The next hearing is scheduled for June.
