Luna crypto project founders Do Kwon and Han Chang-joon are in jail in Montenegro and facing extradition requests from the US and South Korea for document falsification and investment contract law violations.
Do Kwon, the creator of the Luna crypto project, and Han Chang-joon, another member of his team, are still incarcerated in Montenegro. Their attorneys formally asked for their release on bond with the assurance that they would stay in Montenegro yesterday.
The two defendants were arrested for forging documents, not for the initial Earth/Moon project’s failure. In fact, they were detained for having forged passports in March at the airport in Podgorica, the country’s capital.
The US and South Korea, where the guys are from, have both asked for their extradition, but Montenegro has so far refused.
They are facing a trial that might result in very harsh punishments after being accused of breaking the investment contract law known as the Capital Market Act in South Korea.
Lawyers demand that crypto pioneer Luna be freed
Do Kwon was caught in possession of plainly fraudulent documents, but during a hearing yesterday in Podgorica, he denied having committed any crimes.
Then, his attorneys asked for his release on bond pending the start of his trial, which is anticipated to start in approximately a month. They also suggested safety precautions such a need that he report to the state authorities on a regular basis and a ban on his leaving his Podgorica residence.
At this point, however, it does not seem like Do Kwon’s assurances can be taken seriously because he has a long history of lying.
For instance, he entered a not guilty plea and rejected the charge of fabricating documents throughout the hearing.
In light of this, the attorneys requested that the judge end the pre-trial custody in order to ensure that the criminal procedures proceed without a hitch. The suggested bail is merely €400,000 per person, a pittance compared to the proceeds from the Earth/Moon project.
These claims appear to have been denied by the public prosecutor, but the court will still have final say.
It is difficult to predict what it will be, but given that several months have passed between the time the warrant was issued and their capture, during which time they had attempted to run from one nation to another, the chance of absconding can still be deemed significant.
The return of Crypto Luna’s founder, Do Kown
It is thought that the potential extradition may not occur before the conclusion of the criminal procedures in Montenegro.
Therefore, it is feasible that the two accused parties could look for a resolution before the trial is through and consider extradition down the road.
However, it currently appears that none of the remedies they are seeking have been successful, so until the judge decides otherwise, they will continue to be imprisoned.
They will be charged with further, extremely serious offenses if extradited.
It is logical to assume that the Montenegrin government would wait to extradite them until they have been found guilty of the alleged crimes committed in the nation as they do not appear to face exceptionally harsh punishments there.
However, given that the arrest order issued by the South Korean authorities was an international one, it is difficult to assume that they won’t eventually be extradited to the US or South Korea.
It appears unlikely that the two would avoid being turned over to South Korean authorities after their trial in the European nation if they do not receive support there.
Lack of success for Terra/Luna
In fact, despite their new names of Terra Classic and Luna Classic (LUNC), the Terra ecosystem and Luna coin still exist. Do Kwon and his colleagues are no longer a part of the project team, nevertheless.
The so-called Terra 2.0 project, which adopted the name of the previous project and the new coin, also called Luna, before they fled, was established by them.
However, this new endeavor also failed, so there is no telling what the future holds for it.
Within a year, the new cryptocurrency LUNA has lost 95% of its value. The ancient cryptocurrency LUNC is approximately 100% below its April 2018 highs.
The loss since the September 2022 peak is still 83%, even if we consider the post-collapse trend.
These two unsuccessful enterprises are therefore highly unlikely to succeed again.
The $1 million fraud
Numerous analysts believe that Earth/Moon might even be a fake.
The loss of the UST stablecoin’s linkage to the dollar was the main issue. The result of this issue was the collapse of the entire Earth ecology.
The UST was an algorithmic stablecoin backed by LUNA. The value of UST’s backing went below the face value of all the UST tokens when the price of LUNA decreased rapidly, leading to the loss of the peg. The collapse of the peg was inevitable at that point.
Some people believe the ecosystem’s designers knew that a significant decline in LUNA’s value would break the peg with UST. Authorities in South Korea will have to determine if Do Kwon and his colleagues are responsible for the incident.
