Benzinga - by Mehab Qureshi, Benzinga Staff Writer.
Amidst the legal turmoil surrounding Terraform Labs and its founders, the cryptocurrency they created, Terra Classic (CRYPTO: LUNC) is blazing past Bitcoin (CRYPTO: BTC) and Ethereum (CRYPTO: ETH).
What Happened: Terra Classic is up 25%, trading at $0.000099. BTC and ETH were down over 2%.
TerraClassicUSD (CRYPTO: USTC) a decentralized algorithmic stablecoin on Terra Classic, subsequent to its de-pegging incident in May 2022, also spiked over 223% in the last 24 hours.
This comes as a local court in Podgorica has cleared the way for Terraform Labs founder Do Kwon’s potential extradition.
Following the Terra cryptocurrency fiasco, international legal scrutiny has targeted Kwon, who may face extradition to either South Korea or the United States. Authorities apprehended him at Podgorica’s airport with falsified documents, leading to his current detention.
His legal troubles have amplified following the high-profile collapse of cryptocurrency terraUSD last year, which provoked widespread outcry from investors and regulatory bodies alike.
The charges include fraudulent unfair trading, severe punishment of certain economic crimes (fraud), and violations of the Capital Market and Financial Investment Act.
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Why It Matters: The Montenegrin Justice Minister will ultimately have the final say on the extradition matter. However, Kwon has already been sentenced to a four-month prison term in Montenegro for using falsified documents.
In April, Daniel Shin, co-founder of Terraform Labs, was indicted in South Korea on charges of violating capital market laws.
Authorities there have frozen assets amounting to $185 million. Despite the mounting allegations, Shin has maintained his innocence regarding the company’s dramatic collapse, emphasizing that he severed ties with Terraform Labs two years prior to the incident.
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