Korea Awaits Kwon

A federal judge in New York has asked Do Kwon’s attorneys and prosecutors for additional clarification regarding the charges he faces in South Korea and Montenegro. On Thursday, the Terraform Labs co-founder is set to be sentenced in the U.S. after pleading guilty to two fraud-related offenses.

In a filing submitted on Monday, Judge Paul Engelmayer requested details about the potential penalties in South Korea, where Kwon is ultimately expected to be sent after serving part of his sentence in the United States. The judge also wanted to know whether both sides agree that the four months Kwon spent in a Montenegrin prison for using falsified documents will not be credited toward his U.S. sentence.

Engelmayer hinted at concerns that once Kwon is transferred to South Korea, authorities there might release him earlier than expected. The defense, however, emphasized that even if Kwon were to receive a U.S. sentence equal to the time he has already spent in detention, he would be taken straight back into custody upon returning to Korea—where he could still face a sentence of up to 40 years.

U.S. prosecutors are seeking at least 12 years in prison, while the defense is pushing for no more than five. According to the government, the damage caused by Kwon surpasses the combined harm attributed to the former heads of FTX, Celsius, and OneCoin.

Thursday’s sentencing may mark the beginning of the end for legal proceedings stemming from the 2022 collapse of the Terra ecosystem. After the project imploded, Kwon vanished from the public eye until his arrest in Montenegro, from where he is expected to be extradited to the United States.