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Do Kwon Allegedly Financed a Montenegrin Opposition Party

3 mins
Updated by Michael Washburn
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In Brief

  • Montenegro's prime minister calls for an investigation into alleged business ties between Do Kwon and a political rival.
  • Do Kwon has claimed to have provided financial support to the Europe Now party, founded by Milojko Spajic.
  • The Special State Prosecution will assess the validity of the charges in Kwon's latest imbroglio.
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Do Kwon, the founder of Terraform Labs, is under the spotlight again for alleged links with a Montenegrin politician. Milojko Spajic, the founder of the Europe Now party, denies the allegations. It is the latest in a series of controversies and legal troubles to envelop Kwon in recent months.

A report about the relationship appeared on Friday in the Korean publication Yonhap News and other sources. Prime Minister Dritan Abazovic of Montenegro has called on the Special State Prosecution to investigate alleged business ties between Do Kwon and Spajic. Their reputed financial relationship may violate campaign finance laws in Montenegro.

According to a Balkan Insight report, the charges of business ties between Do Kwon and Spajic originate from a letter sent by Kwon to Abazovic, outgoing Justice Minister Marko Kovac, and the Special State Prosecution. In the letter, Do Kwon claimed to have offered financial support to Europe Now.

The Special State Prosecution will determine whether there is any truth to the allegations.

Europe Now is a centrist, pro-European movement based in Montenegro. Spajic founded the political party last year and is its current president. He previously served in the cabinet of Zdravko Krivokapić as a minister of finance and social welfare.

Learn more about algorithmic stablecoins like Terra: What Are Algorithmic Stablecoins?

Spajic was due to contest the March 2023 presidential elections. But he was later disqualified due to suspicions of Serbian citizenship. Montenegrin law prohibits individuals with dual citizenship from running for the presidency.

Abazovic reportedly said during a press conference on Wednesday that “It’s not good for Montenegro if Spajic had contacts with Do Kwon, because the man is wanted by the US and South Korean authorities.”

The 35-year-old Spajic denies the claims. However, he confirmed that he and the company he worked for had invested in Terra.

Kwon Is Currently Out on Bail

Do Kwon founded Terra LUNA in 2018, offering fast cryptocurrency settlement and issuing stablecoins pegged to various world currencies. However, issues arose when the value of the stablecoin UST dropped below its peg, leading to a severe decline in its trading price. The collapse resulted in a $40 billion wipeout across the crypto industry within days.

In March, authorities in Montenegro arrested Kwon and an associate on suspicion of passport fraud. Shortly after, the Terraform Labs founder disappeared for several weeks. He is also wanted in the United States and South Korea for his role in the financial fiasco. For his part, Kwon denies all charges.

The disgraced founder has been granted release with bail set at 400,000 euros, allowing him to stay in an apartment with police monitoring until his next hearing on June 16.

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Josh Adams
Josh is a reporter at BeInCrypto. He first worked as a journalist over a decade ago, initially covering music before moving into politics and current affairs. Josh first owned Bitcoin in 2014 and has followed the space ever since. He is particularly interested in Web3 adoption, policy and regulation, CBDCs, privacy, and the future of the metaverse.
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