Swiss authorities have reportedly frozen approximately $26 million in Bitcoin and other cryptos tied to Terraform Labs, its founder Kwon Do-hyeong, and other key figures within the company.
These crypto assets were stored in the Swiss-based digital asset bank Sygnum, according to a report from South Korean news outlet Digital Asset on Saturday, citing unnamed authorities and investigators.
Per Digital Asset, Swiss authorities followed requests from the U.S. federal prosecutors of New York and the Securities and Exchange Commission.
Decrypt has contacted the Office of the Attorney General of Switzerland and will update this article should we receive a response.
This development is the latest chapter in a saga that started with the collapse of Terraform Labs' algorithmic stablecoin, UST, in May 2022.
How Terra's UST and LUNA Imploded
Decrypting DeFi is Decrypt's DeFi email newsletter. Art: Grant Kempster Amid the craziest week in crypto ever, the collapse of Terra's UST stablecoin and governance token LUNA emerged as the biggest story. Amid the crash, LUNA, formerly a top 10 coin by market cap, fell 100% to fraction of a fraction of a cent, and UST, designed to stay pegged at $1, bottomed out at 13 cents. So what the hell happened? Grab your coffee, you're going to need it. There were several forces at work. The first is the...
Kwon is accused by the U.S. and South Korean prosecutors of fraud, securities law violations, and several other charges related to the collapse of Terra. While admitting that mistakes were made, Kwon continues to argue he had no intent to deceive investors.
Do Kwon sentenced to jail
Last week, Kwon and Chang-joon Han, the former chief executive officer of Terraform Labs, were sentenced to four months in prison by a Montenegrin judge on charges relating to the forgery of travel documents.
The two were arrested in March at Montenegro’s Podgorica Airport while attempting to fly to Dubai, as per the court statement. During their arrest, authorities confiscated falsified documents including two Costa Rican passports, two Belgian passports, and two identity cards.
Terra Co-Founder Do Kwon Sentenced to Four Months in Prison for Forged Passports
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 fak...
Both Kwon and Han pleaded not guilty at their first court hearing in May. The Montenegrin upper court decided to grant bail to each of them at $437,000, proposing house arrest under police supervision in the interim.
The next step for Kwon remains unclear. Both the U.S. and South Korea have sought to extradite him. In February, the U.S. Securities and Exchange Commission (SEC) charged Kwon and Terraform with defrauding U.S. investors who purchased Terra USD and LUNA tokens.
