(The Herald Post) – The Seoul Southern District Court has once again rejected a request for the pre-trial detention of Shin Hyun-seung, also known as Daniel Shin, a co-founder of the now-defunct blockchain firm Terraform Labs. Shin is believed to have been a key figure in the collapse of the company’s cryptocurrencies, luna and the stablecoin terrausd. The court’s decision, reported by the Yonhap news agency, indicates that Shin is not considered a flight risk or likely to destroy evidence.
Kwon was apprehended in Montenegro while attempting to board a flight to Dubai. South Korean authorities are now seeking his extradition, which is expected to be a lengthy process. Kwon is set to stand trial in Montenegro for traveling on a fake Costa Rican passport, as disclosed by his Montenegrin lawyer and the country’s justice minister.
In South Korea, Shin faces multiple charges, including fraud and violations of laws governing capital markets, financial transactions, and information. He is accused of storing pre-issued luna, selling the tokens for approximately 140 billion won (almost $108 million) at a high price point, and failing to disclose the risk of the cryptocurrencies’ collapse to investors.
Furthermore, Shin is alleged to have used customer information and funds from Chai Corp., a fintech firm he led, to promote luna. He has denied all these allegations, maintaining that he was not connected to Terraform Labs after departing the company in March 2020 to establish Chai Corporation.
According to South Korea’s national broadcaster KBS, the Seoul court has recognized that the charges against Shin have been largely substantiated. However, the court also noted that the risk of evidence destruction has been reduced with Kwon’s arrest and emphasized the importance of allowing Shin to exercise his right to defend himself.
This week, Montenegro’s Interior Minister Filip Adžić disclosed that investigators found three laptops and five mobile phones belonging to Kwon, which contained a wealth of “very interesting” information. South Korea and the U.S., which is also seeking Kwon’s extradition, have both requested access to these devices. Montenegrin officials announced the development during a press conference with Justice Minister Marko Kovač in Podgorica.