Montenegro Court Approves Second Bail Request For Do Kwon

Updated: 05 June 2023

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A Montenegro Court has approved Terra co-founder, Do Kwon, and former chief financial officer, Han Chang-joon’s bail request for the second time. This comes after the two were accused of attempting to travel with falsified documents. In a Friday announcement, a Montenegro court handling Do Kwon’s forgery case has accepted 400,000 euro ($428,000) bail request after the high court annulled the previous approval.

This decision relieves the Terra Luna community and the cryptocurrency ecosystem as a whole. It marks a step forward in resolving the legal challenges of one of the leading blockchain projects.

Terra Luna, a blockchain-based platform that aims to create a stable and scalable digital currency ecosystem, has gained significant attention and adoption since its inception. Do Kwon, the founder of Terra Luna, has driven the project’s growth and success. However, he faced legal trouble when arrested in Montenegro for alleged fraud.

Montenegro Court Approves Do Kwon’s Bail

Lawyer Branko Andelic has confirmed that Terra co-founder Do Kwon and CTO Han Chang-joon’s bail of 400,000 Euros each has been approved again by the Montenegro Basic Court. In May, the Montenegro Basic Court’s earlier decision to grant bail for defendants for a total of 800,000 Euros was revoked by the Montenegro High Court.

Kwon, 32, and Han had been on the run after fleeing South Korea while being probed about the crash of Terraform Labs’ TerraUSD and Luna coins in May last year. The crash wiped out nearly 50 trillion of TerraUSD (UST) in market value.

However, the two were arrested at Podgorica Airport in late March while trying to leave the country with forged passports. Further, since Do Kwon’s arrest, South Korea and the U.S. have requested Terra Founder’s extradition to face criminal charges following his trial in Montenegro.

Nonetheless, the court has ruled that both should stay in the apartment address their lawyer Branko Anđelić provided until the end of the passport forgery case. They must comply with court summons, surveillance, and other measures the court takes.

Further, the Basic Court considered the seriousness of the criminal offense. This includes the personal and family circumstances of the defendants and the financial conditions of the persons paying for the bail. Notably, the court will check the authenticity of travel documents and identity cards as Do Kwon’s lawyer claimed the Costa Rican passports are legally obtained.

Significantly, suppose the defendants violate the imposed measures, the court will revoke their bail, and the bail amount will be added to the court’s budget. Additionally, Do Kwon’s extradition to either South Korea or the U.S. will only happen after he serves his sentence in Montenegro.

Prosecutors To Appeal Against Court Ruling

Earlier, the prosecutors appealed to an upper court, requesting the decision be revoked. They noted that the proposed bail money is substantially small compared to Kwon’s overall wealth and cited concerns about the two fleeing.

Further, the upper court in Podgorica accepted the request and rescinded the bail. However, according to the latest announcement, the lower court again granted their release on bail. It said that the decision is made on the assessment that the bail money is not a small sum given their asset size.

A local attorney representing Kwon and his aide, recently submitted a document showing their financial status as evidence to the district court, according to Vijesti, a Montenegrin newspaper.

On the other hand, the Basic Court has given three days for prosecutors to appeal against the new court ruling. Otherwise, the court will release the defendants on bail and new condition.

Kwon is also wanted by U.S. Prosecutors, who have accused him of fraud, securities law violations, and other charges related to the collapse of the Terra stablecoin and Luna cryptocurrency. However, Kwon has denied all the allegations against him. He has admitted mistakes were made in the Terra-Luna project managed by Terraform Labs. Notably, he has argued that there was never any intent to deceive investors.

TerraUSD was designed as a stablecoin, pegged to stable assets like the U.S. dollar. However, holders of TerraUSD and Luna lost more than an estimated $40 billion in market value after the stablecoin plunged far below its $1 peg last May.

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