SEC Agrees to Postpone Do Kwon and Terra Trial Until April 15
15th Jan, 2024
The U.S. Securities and Exchange Commission (SEC) has shown a willingness to delay the trial of Do Kwon and his blockchain startup Terraform Labs until mid-April, while the proceedings for Kwon's extradition continue in Montenegro. The SEC's decision comes in response to the two court arguments filed by federal prosecutors regarding the trial of Kwon and Terraform Labs over the $40 billion collapse of TerraLuna (LUNC) and TerraUSD (UST) in May 2022.
In a recent development, Kwon's lawyers sought court approval to postpone the trial until March 18, citing the need for Kwon to attend the trial. They also stated that the defendant would not file for a second extension if he could not meet the court's new date.
Meanwhile, Kwon has filed another appeal to overturn a Montenegro High Court's ruling upholding extradition requests from his native South Korea and the United States, where he faces charges. His attorneys argue that the High Court's verdict ignored a bilateral extradition treaty with America and the European Convention on Extradition. Kwon had previously won an appeal against the extradition requests in November last year, but the High Court in Podgorica reinstated its ruling weeks later in December.
Do Kwon and Terraform are accused of misleading users and investors about the stability of UST, an algorithmic stablecoin pegged to the U.S. dollar. The collapse of Terra's ecosystem, which began with the failure of UST to maintain its promised $1 price, led to a domino of bankruptcies and the start of the crypto winter in 2022.
The SEC has also agreed to a "modest adjournment" of the Terraform case and argued against separate trials for Kwon and Terraform, as the cases are closely linked. As the legal proceedings continue, the outcome of the trial and the fate of Do Kwon and Terraform Labs remain uncertain.