Embattled founder of Terraform Labs Do Kwon and its former Chief Financial Officer Han Chang-Joon are set to be released on bail after the Basic Court in Podgorica, Montenegro dismissed an appeal by the prosecutors to revoke the initial bail granted to the defendants on 12 May.
As per the court’s official statement, the bail terms previously set will remain unchanged. Each defendant is required to provide a bail amount of €400,000, and they will be placed under house arrest with strict police monitoring. The court emphasised that any breach of the imposed conditions will result in the forfeiture of the bail.
Do Kwon and Chang-Joon submitted personal financial statements to the court to secure their bail including proof of sales contract, property registration documents for an apartment, parking space, basement and a vehicle invoice.
The statement further revealed that the court carefully evaluated various factors, including the defendants’ financial situation, the gravity of the charges, their personal and family circumstances, and the input of the prosecution representative before reaching the verdict. It also took into account that the defendants were not Montenegrin citizens and accepted their property valuation which was substantiated by supporting documents.
Possible flight risk concerns
The court raised concerns regarding the uncertain time frame for verifying the travel documents of Do Kwon and Chang-Joon. However, it concluded that the bail conditions were sufficient enough to discourage the defendants from absconding.
These concerns are amidst charges of travel document falsification against Kwon and Chang-Joon. Earlier last month, both men were apprehended at the airport in Podgorica for attempting to fly to Dubai using forged documents, which they both pleaded not guilty to.
Kwon and Chang-Joon’s woes began when their $40bn crypto empire collapsed in June 2022, causing significant losses to millions of investors. Prior to that, LUNA was a top 10 cryptocurrency by market capitalisation while its algorithmic stable coin, UST was the second largest stable coin behind USDT and USDC.
In the aftermath of the infamous LUNA collapse, South Korean authorities initiated extradition proceedings against Do Kwon and five others, charging them with fraud. This was after its foreign ministry revoked Kwon’s passport in October 2022 when he failed to comply with their request for submission.
More prosecutors have joined the global pursuit of the crypto entrepreneur as New York prosecutors similarly filed charges against him in the United States, including eight counts of securities fraud, commodities fraud, wire fraud, conspiracy to defraud, and engaging in market manipulation.
LUNC Price Reaction
Terra Classic (LUNC), the native cryptocurrency of the collapsed LUNA ecosystem, quickly reacted to the news, surging by 30% to $0.0001083. The upward price movement is further fuelled by the anticipated v2.1.0 parity upgrade scheduled for 14 June. The upgrade will introduce significant improvements and community-centric features to the ecosystem.
Validator incentives will be significantly increased to a minimum of 5% commission to foster a stronger and more sustainable network participation. This boost in incentives aims to attract and retain validators by providing them with greater rewards for their crucial role in maintaining network security and consensus.
The forthcoming network upgrade will bring substantial security enhancements, including the integration of Cosmwasm v1.1x, bolstering the system’s strength and resilience while rebuilding user trust. Additionally, the upgrade will address protocol security updates and fix the infinite fee grant bug.
Furthermore, a significant emphasis will be placed on enhancing the ecosystem’s interoperability with other blockchains, fostering an environment that entices founders and developers to build their projects on the network.
At the time of writing, the price of LUNC is trading at $0.00009884.