With Sam Bankman-Fried in the slammer, now the fugitive crypto 'Lunatic' behind 2022's $40B crash is being extradited from his Montenegrin getaway

Terraform Labs CEO Do Kwon — (Image credit: Woohae Cho/Bloomberg via Getty Images)

Do Kwon, former crypto darling and now fugitive, was arrested in Montenegro this March while attempting to flee to Dubai. The High Court in Podgorica, the Montenegrin capital, has now given approval for Do Kwon's extradition, though whether he'll be off to South Korea or the US, both of which have open arrest warrants for him, remains to be decided.

Do Kwon was the main player and public face of the TerraUSD stablecoin and the self-described "Lunatic" driving the Luna cryptocurrency. You can probably tell where this is going. The more-or-less overnight collapse of both caused a loss of around $40 billion on crypto markets and was the major factor behind the 2022 catastrophe-slash-contagion that saw FTX go under, with its founder Sam Bankman-Fried now facing a lengthy jail sentence, and a multitude of other crypto firms go bust.

The one-time crypto baron did what all innocent people do in such a situation, and fled to a country that has no extradition treaty with the US or South Korea, while publicly declaring he wasn't on the run. Sadly for Do Kwon, the High Court has "determined that the legal requirements for the extradition of the accused KDH have been met, at the request of South Korea and the United States of America."

Even now he's trying to angle it. Do Kwon has consented to being extradited to South Korea (he is originally from Seoul) under a shortened process rather than face being sent to the US. The decision on his destination rests with Montenegro's minister of justice Marko Kovač, who has not commented on the current ruling but said on Do Kwon's arrest that "determining which state they will be extradited to will be based on several factors."

Do Kwon had entered Montenegro using a faked passport, after fleeing Singapore in September 2022. He said multiple times he wasn't on the run, which didn't stop South Korea issuing an arrest warrant and shortly thereafter Interpol issuing a Red Notice. The US authorities have filed an indictment against him, saying he orchestrated "a multi-billion-dollar crypto asset securities fraud", with charges including conspiracy to defraud, commodities fraud, securities fraud, and wire fraud.

That's a lotta (alleged) fraud. Not to be deterred, Do Kwon's former company Terraform Labs attempted to have the US case dismissed, but this was denied in August 2023.

The one upside is that this seems to have served as a serious wake up call for regulators, who since 2022's so-called crypto winter have been pursuing the figureheads behind these institutions with a renewed zeal. In his last interview to date, Do Kwon got a little philosophical about the prospect of jail: "Life is long." In some cases yes but, when you're behind something like this, the sentence probably will be too.

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Rich is a games journalist with 15 years' experience, beginning his career on Edge magazine before working for a wide range of outlets, including Ars Technica, Eurogamer, GamesRadar+, Gamespot, the Guardian, IGN, the New Statesman, Polygon, and Vice. He was the editor of Kotaku UK, the UK arm of Kotaku, for three years before joining PC Gamer. He is the author of a Brief History of Video Games, a full history of the medium, which the Midwest Book Review described as "[a] must-read for serious minded game historians and curious video game connoisseurs alike."