Terraform Labs co-founder Do Kwon may not be extradited to South Korea to face criminal charges following a challenge by Montenegrin prosecutors that could take the case to the country’s Supreme Court.

In a March 21 announcement, prosecutors said they requested a protection of legality before the Supreme Court of Montenegro following an appeal to stop Kwon’s extradition to South Korea. According to the request, the appellate court violated procedure in rejecting an appeal from Kwon’s legal team. It argued only the Supreme Court had the authority to adopt a legal decision in the case.

Montenegrin courts have been weighing whether to grant extradition of Kwon to the United States or South Korea, where he could face criminal charges related to his role in the downfall of Terraform Labs. Following a decision on March 20, it appeared that the Terraform Labs co-founder was going to be extradited to South Korea. However, prosecutors suggested that the supreme court could “issue a verdict that would change the Court’s decision.”

“[T]he court, contrary to the law, conducted abbreviated, instead of regular proceedings and by exceeding the limits of its powers, made a decision on the extradition permit, which is the exclusive competence of the Minister of Justice,” said prosecutors in a translated statement.

Kwon, a South Korean national, has seemingly preferred extradition to his native country rather than the United States. Following the collapse of Terra in 2022, the South Korean government has been imposing harsh penalties on individuals involved in crypto-related crimes. In the U.S., high-profile figures from the crypto space, including Sam Bankman-Fried, Changpeng Zhao and Alex Mashinsky, have been convicted, pleaded guilty or will face criminal charges at trial for their roles at FTX, Binance and Celsius, respectively.

Related: US prosecutors to continue tussle for Do Kwon’s extradition: Report

In March 2023, authorities arrested Kwon in Montenegro for using falsified travel documents. He was subsequently sentenced to four months in prison and has been in custody as the country weighs extradition requests from the U.S. and South Korea.

South Korean authorities indicted several individuals associated with Terraform Labs, including co-founder Hyun-seong Shin. The firm’s former chief financial officer, Han Chang-joon, was arrested in Montenegro at the same time as Kwon but extradited to South Korea in February.

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