Do Kwon Destined For U.S. Court?

The Terraform Labs co-founder could be extradited to the U.S....

By: André Beganski

December 11, 2023

This week: A federal judge in Seattle ruled that former Binance CEO Changpeng Zhao must stay in the U.S. until he’s sentenced, Montenegro’s justice minister reportedly said that Terraform Labs co-founder Do Kwon will be extradited to the U.S., and a mushroom-centric auction from Sotheby’s is the latest development in the debate around Bitcoin Ordinals.

Enduring the Emerald City

U.S. District Judge Richard Jones ruled on Thursday that former Binance CEO Changpeng Zhao can’t return home to the United Arab Emirates until he’s sentenced in February. Last month, Zhao stepped down from Binance as part of a plea agreement. He also agreed to pay a separate $50 million fine for violating anti-money laundering laws.

While Zhao could theoretically face a decade in prison, Binance’s former leader isn’t expected to receive a sentence of more than 18 months, per Bloomberg News. As part of the plea agreement, both Zhao and Binance acknowledged lackluster anti-money laundering policies at the exchange and U.S. sanctions violations — but the deal allowed Binance to survive.

In Judge Jones’ ruling, the court cited Zhao’s “enormous wealth and property abroad” as a factor that made him a flight risk, as well as his lack of ties to the U.S. When he pled guilty, Zhao made an appearance in a Seattle court, suggesting he could be in the Emerald City.

Do Kwon Destined To Be Sent To The U.S.?

Terraform Labs co-founder Do Kwon could be extradited from Montenegro to the U.S. to face charges that stem from the collapse of cryptocurrencies TerraUSD and Luna, according to an article published by the Wall Street Journal on Thursday.

Citing unnamed sources, the publication said Montenegro’s Justice Minister Andrej Milovic has signaled in “closed-door discussions” that the country plans to extradite Kwon to the U.S., even as South Korean prosecutors seek his extradition as well.

Last month, Kwon’s extradition from Montenegro was approved. Kwon has been held custody in Montenegro for months after he was arrested trying to leave the country with a forged passport. While Miolvic has yet to officially signal where Kwon will be extradited, he said, in a statement to the WSJ, “The public will be informed of the decision in a timely manner.”

Jumping Jito

Around $225 million worth of JTO was airdropped last week to users of the Solana-based DeFi application Jito, representing a significant source of free tokens, per Decrypt. The governance token debuted at $6.09 but currently trades at around $2.94.

Similar to the Ethereum staking solution Lido, Jito users can stake Solana (SOL) in exchange for Jito Stake SOL (JITOSOL). According to DefiLlama, the protocol’s total value locked or TVL has increased to $433 million from around $55 million over the past two months.

Bursting onto the crypto scene at a break-neck pace, JTO has amassed a market capitalization of nearly $335 million, making it the 150th largest cryptocurrency by market cap, according to CoinGecko. In light of the airdrop, traders have piled into Solana in search of other decentralized applications that could yield free tokens in the future, per DL News.

Sotheby’s Special, or a ‘Bug’

Storied auction house Sotheby’s unveiled plans to sell art from BitcoinShrooms, a series of Ordinals inscriptions created by the pseudonymous artist Shroomtoshi. Hosting the auction online through Wednesday, it represents the first time that the 279-year-old auction house has engaged with a class of NFT-like assets built on top of Bitcoin.

Art pieces from the collection that are included in the sale have garnered bids that are mostly above their respective estimates: $42,000, $50,000, and $28,000. Notably, Sotheby’s accepts bids on BitcoinShrooms in crypto. 

Launched earlier this year, Ordinals allows for creating NFT-like assets on top of Bitcoin by letting people “inscribe” data on individual satoshi — the smallest divisible unit of Bitcoin. Meanwhile, Ordinals' critics have been vocal recently as the protocol gains traction with influential art firms.

Bitcoin Core developer Luke Dashjr, who has opposed Ordinals in the past, said Tuesday the protocol stems from a “bug” in Bitcoin that should've been “fixed” long ago. Describing it as a “vulnerability” in Bitcoin Core’s current implementation, he said the mechanism that allows for Ordinals inscriptions should be addressed in future versions of the software.

To that end, the alleged bug was flagged by someone on the National Institute of Standards and Technology’s website, which assigned it the identifier CVE-2023-50428. Among those who highlighted the development was Dashjr, who shared the identifier with users on X on Sunday.

Robinhood Crypto Enters EU

Robinhood introduced its Robinhood Crypto app to users in the European Union (EU) last week, as the stock trading platform embarks on an international push within the crypto space. When the firm unveiled its crypto trading platform to users in the U.S. in 2018, it only included Bitcoin and Ethereum as offerings, but it has since expanded its to a roster of 25 different coins.

“We’re on a mission,” Robinhood CEO Vlad Tenev said on X, formerly known as Twitter, linking to a statement on Robinhood’s EU push.

Last month, Coinbase CEO Brian Armstrong said that the digital assets industry is ready to “turn the page,” following FTX founder Sam Bankman-Fried’s conviction on fraud and conspiracy charges, as well as Zhao’s plea agreement that forced him to step down from his leadership position at Binance. 

Amid the power vacuum in crypto left by Zhao and Bankman-Fried, it’ll be interesting to see how Robinhood positions itself as a firm that’s increasingly cozied up to crypto. But whether or not Tenev’s attempt at garnering influence could be influenced by Robinhood’s antagonistic role in the meme stock saga with GameStop in 2021 has yet to be seen.

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