Montenegro’s high court approved Terra cofounder Do Kwon’s request for bail, which is set at 400,000 euros ($427,740), according to a statement published on June 2.
The court revoked an initial bail decision made by the basic court. The basic court has since appealed this decision requesting the same bail conditions of $427,740 for each defendant as well as additional monitoring of the defendants including a ban on leaving their apartments. Podgorica’s high court has accepted this appeal.
Kwon and former Terra executive Han Chang-joon are being held in Montenegro for allegedly attempting to travel with fake documents. Terra was one of the fastest growing blockchain networks in 2021 with a market capitalization of around $45 billion at its peak across its two tokens Luna and its algorithmic stablecoin TerraUSD (UST). The market capitalization of those two tokens cratered when UST started to depeg in May, 2022 and investors panicked about the stability of the tokens and network.
South Korean authorities asked Interpol to issue a “red notice” to law enforcement worldwide for the arrest of Kwon, a South Korea national, and other Terra executives. This came just weeks after South Korean authorities issued an arrest warrant for Kwon and several executives in response to the collapse of the Terra ecosystem that resulted in the loss of billions of dollars for investors and allegedly violated the country’s capital markets laws.
Both South Korea and the U.S. have requested Kwon’s extradition to face criminal charges following the Montenegro trial. The Securities and Exchange Commission (SEC) also charged Kwon and his company Terraform Labs in February alleging that they misled investors.
In the Montenegro case, the defendants could face a sentence of between three months to five years. The authorities are also working with Belgium authorities to establish the authenticity of travel documents and identity cards that the defendants allege were issued by Belgian authorities.
“When making this decision, the court took into account the evidence on the financial situation of the defendants provided by their defense counsel, the seriousness of the criminal offense for which the defendants are reasonably suspected, their personal and family circumstances, as well as the financial situation of the persons providing bail, and the opinion of the prosecution representative,” said Podgorica’s Basic Court in a statement.
The prosecution has three days to appeal the higher court’s decision.