The United States Attorney’s Office revealed an additional charge for Terraform Labs co-founder Do Kwon following his extradition from Montenegro: money laundering conspiracy.
In a superseding indictment unsealed on Jan. 2 in the US District Court for the Southern District of New York, US Attorney Damian Williams alleged Kwon conspired with others to commit money laundering.
According to the US Attorney, the Terraform co-founder facilitated transactions of more than $10,000 on the platform “knowing that the property involved in certain financial transactions represented the proceeds of some form of unlawful activity.”
Do Kwon superseding indictment unsealed on Jan. 2. Source: Courtlistener
The money laundering charge was part of a superseding indictment not initially filed as part of the eight-count indictment against Kwon in March 2023. Prosecutors filed the indictment under seal in May 2024, and a judge ordered it unsealed amid Kwon’s court appearance on Jan. 2.
Kwon, alleged to have been involved in the 2022 collapse of the Terra ecosystem, was arrested and jailed in Montenegro for using falsified travel documents in 2023. Authorities from the US and South Korea filed competing petitions to extradite the Terraform co-founder, but Montenegrin authorities did not decide on his legal status until December 2024, when Kwon was handed over to US officials.
Trial or plea deal?
The Terraform co-founder appeared in court on Jan. 2 and pleaded not guilty to all charges, agreeing to be held in detention. It’s unclear whether US authorities will consider a plea deal or intend to move forward with a criminal trial.
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Kwon’s case parallels that of former FTX CEO Sam “SBF” Bankman-Fried — another crypto executive who was subject to another country’s jurisdiction (the Bahamas) before being extradited to the US. In SBF’s case, his lawyers were able to argue a campaign finance charge added to a superseding indictment should be dropped as it was not part of the extradition request.
Bankman-Fried was later convicted of seven felony counts and sentenced to 25 years in prison, but he has filed an appeal.
Former Binance CEO Changpeng Zhao — another significant industry figure — pleaded guilty to one charge and served four months in prison in 2024.
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