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- Terraform Labs co-founder Do Kwon was charged with eight offenses in 2023 and is likely to face an additional money laundering charge.
The United States Attorney’s Office revealed an additional charge for Terraform Labs co-founder Do Kwon following his extradition from Montenegro: money laundering conspiracy.
In a new indictment filed on January 2 in the U.S. District Court for the Southern District of New York, U.S. Attorney Damian Williams alleged that Kwon conspired with others to commit money laundering.
According to the U.S. Attorney, the Terraform co-founder facilitated transactions of over $10,000 on the platform, knowing that the property involved in certain financial transactions represented the proceeds of unlawful activity.
The money laundering charge was not initially part of the eight-count indictment filed against Kwon in March 2023. Prosecutors filed the indictment under seal in May 2024, and on January 2, a judge ordered the unsealing of the indictment during Kwon’s court appearance.
Kwon, who is alleged to have been involved in the 2022 collapse of the Terra ecosystem, was arrested and detained in Montenegro in 2023 for using falsified travel documents. Authorities from the U.S. and South Korea filed competing petitions to extradite the Terraform co-founder, but Montenegrin authorities did not make a decision on his legal status until December 2024, when Kwon was handed over to U.S. officials.
Will It Be A Court Trial or A Settlement Agreement?
The Terraform co-founder appeared in court on January 2, pleaded not guilty to all charges, and agreed to remain in detention. It remains unclear whether U.S. authorities will consider a plea deal or move forward with the charges.
Kwon’s case is similar to that of former FTX CEO Sam “SBF” Bankman-Fried, another crypto executive who was subject to the jurisdiction of another country (the Bahamas) before being extradited to the U.S.
In SBF’s case, his lawyers argued that a campaign finance charge added to a superseding indictment should be dropped, as it was not part of the extradition request.
Bankman-Fried was convicted on seven felony counts and sentenced to 25 years in prison, but he has filed an appeal.
Former Binance CEO Changpeng Zhao pleaded guilty to one charge and served four months in prison in 2024.
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