January 15, 2019 (Reuters) – In order to allow Do Kwon, a co-founder of Terraform Labs, to be extradited and attend the civil trial against him for allegedly masterminding a $40 billion bitcoin scam, the U.S. Securities and Exchange Commission decided to postpone it.
The SEC claimed in a Monday filing in Manhattan federal court that Kwon’s lawyer’s assertions that his client desired to attend, consented to extradition from Montenegro, and would be in the country by mid-March supported a “modest” postponement of the trial scheduled for January 29.
Additionally, it opposed separate trials for Kwon and Terraform, arguing that the issues were essentially the same and that having whistleblowers and regular retail investors testify again would be needless.
The trial date may be rescheduled at the discretion of U.S. District Judge Jed Rakoff. To account for schedule conflicts, the SEC requested April 15th.
Despite Kwon’s inability to appear on the rescheduled date, Kwon’s attorney on Monday said he will not seek any additional postponements. Kwon’s counsel had requested a delay until at least March 18.
The dispute is related to the demise of Luna, a more conventional token that was closely associated with TerraUSD, and TerraUSD, a “stablecoin” intended to keep its value at $1.
In May 2022, both cryptocurrencies experienced a loss of at least $40 billion as TerraUSD was unable to sustain its $1 peg.
The SEC claimed that Terraform and Kwon had misled investors on the stability of TerraUSD and the way in which a well-known Korean mobile payment app settled transactions using the Terraform network.
Rakoff declared last month that Terraform and Kwon had failed to register TerraUSD and Luna in accordance with US law.
Kwon is also the subject of extradition requests from his home South Korea and related criminal accusations in the United States. March of last year saw his arrest in Montenegro.
The case number for the Southern District of New York U.S. District Court case is 23-01346; it is SEC v. Terraform Labs Pte Ltd et al.