SEC Agrees to Delay Terraform Case
The U.S. Securities and Exchange Commission (SEC) is open to postponing the crypto fraud trial of Do Kwon, co-founder of Terraform, and is willing to wait until he is extradited. Federal prosecutors have submitted court filings outlining the case against Kwon and Terraform Labs regarding the collapse of TerraLuna and TerraUSD in May 2022.
Delay Requested for Extradition Proceedings
Kwon’s legal team has requested a delay in the January trial so that he can participate in his defense in person. They cited the slow progress of the extradition proceedings initiated after Kwon’s detention in Montenegro. The SEC has consented to a modest adjournment until April 15, allowing for ongoing extradition proceedings.
Opposition to Separating Kwon’s Case
The SEC opposes separating Kwon’s case from Terraform’s. Both were named defendants when the agency filed charges, and the SEC argues that it would unnecessarily require witnesses to testify twice about identical facts in different trials.
Kwon Files Appeal Against Extradition Requests
Kwon has filed another appeal to overturn a Montenegro High Court ruling that upheld extradition requests from South Korea and the United States. His attorneys argue that the ruling disregarded a bilateral extradition treaty with the U.S. and the European Convention on Extradition.
Fraud Allegations Against Kwon and Terraform
Kwon and Terraform are accused of deceiving users and investors about the stability of TerraUSD. The failure of TerraUSD to maintain its promised $1 price resulted in a collapse within Terra’s ecosystem, leading to bankruptcies and marking the beginning of the crypto winter of 2022.
Hot Take: Uncertain Future for Do Kwon
The SEC’s consent to delay the Terraform case provides some respite for Do Kwon, but his troubles are far from over. With ongoing extradition proceedings and a filed appeal against the High Court’s ruling, Kwon’s legal battles continue. The allegations of fraud and deception surrounding TerraUSD have had significant consequences for the crypto industry. As the case unfolds, the outcome will have implications not only for Kwon and Terraform but also for the broader regulatory landscape of cryptocurrencies.
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