Terraform Labs co-founder Do Kwon has been sentenced to four months in prison in Montenegro after denying today in court that he and business partner Chang-joon Han used forged passports, according to a statement on the Montenegro Basic Court website.

In a statement to the Montenegrin Basic Court last Friday, Kwon said he was unaware of the alleged forgery of the Costa Rican passport he was carrying, according to a report from South Korean news outlet Segye Ilbo. "If I had suspected it was a fake passport, I would not have traveled to many countries," Kwon is quoted as saying.

"I filled out all the documents and received a Costa Rican passport through an agency in Singapore recommended by a friend,” Kwon reportedly said, adding that he had traveled all over the world with a Costa Rican passport.

Additionally, Kwon is in possession of a Belgian passport, which he claims to have received through another agency.


Kwon and Terraform Labs’ former chief financial officer Han were arrested at Montenegro's Podgorica airport in March while attempting to travel to Dubai with allegedly forged documents, following the collapse of the Terra ecosystem in 2022.

The pair are the subject of a jurisdictional battle between prosecutors in South Korea and the U.S.

When questioned by the prosecution about the specific agency he used for obtaining his passports, Kwon reportedly stated that he couldn't recall the exact details.

He mentioned that the agency's name was in Chinese but couldn't provide any further information.


Kwon also insisted on the innocence of his aide Han, telling the court that "If you are punished for a fake passport, let me be the only one."

The prosecution, however, asked the court to punish both Kwon and Han, reportedly saying that if the passport was not issued by a legitimate institution, it was made with bad intentions.

The court’s verdict is expected to be delivered on Monday, June 19.

Do Kwon and Terra

The collapse last year of the Terra ecosystem, its algorithmic stablecoin UST and its sister coin LUNA, is considered to be among the key factors that contributed to the crypto industry’s slide into a lengthy crypto winter.

Back then, the prices of Bitcoin and other major cryptocurrencies plunged heavily following the implosion of Terra, while also hitting several established crypto companies, such as Three Arrows Capital (3AC), Voyager Digital, and Celsius Network, which all went bankrupt.

Apart from denying the forgery accusations related to his travel documents, Kwon also pushed back against allegations that he had made financial contributions to Milojko Spajić, the former finance minister of Montenegro and current leader of the Europe Now party.

According to a Radio Free Europe report, the South Korean entrepreneur “decisively denied” that he had any financial relations with Spajić, or that he participated in any way in the financing of his political campaign.

Editor's Note: This post was updated to reflect the fact that Do Kwon has now been sentenced.


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