Terra has filed for bankruptcy, but Do Kwon’s Serbian company is still standing

Terra has filed for bankruptcy, but Do Kwon’s Serbian company is still standing
Do Kwon is incarcerated in Montenegro awaiting extradition. Photo illustration by Andrés Núñez Credit: Andrés Tapia
  • Do Kwon set up a Serbian firm when he was a fugitive.
  • Prosecutors in the US and South Korea are pursuing his extradition.
  • DL News unearthed mystery company in March.

There’s at least one Do Kwon venture still ticking.

Terraform Labs have finally filed for bankruptcy almost two years after it poleaxed the crypto market in a $60 billion failure.

But another business owned by founder Kwon remains alive and well — an enterprise he set up in Serbia in 2022 when he was on the run from Interpol.

Mystery company

The company, called Codokoj22 d.o.o. Beograd, appears to be little more than a corporate filing. Yet the firm has outlasted Terra, a DeFi ecosystem that was supposed to eclipse Ethereum with tokens, a lending arm, and a blockchain network.

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Terraform Labs filed for a Chapter 11 bankruptcy in the US on January 21.

Meanwhile, US and South Korean prosecutors are pursuing extradition of Kwon from Montenegro to face charges in both nations of fraud in connection with the collapse of Terraform Labs.

“The company remains operational and intends to meet all financial obligations to both employees and vendors during the Chapter 11 case without requiring additional financing,” the firm said in a statement on X.

In additional comments sent after the original publication of this story, Terraform Labs added that it “plans to continue expanding its web3 offerings” and that the Chapter 11 filing will enable it to “execute on its business plan while navigating ongoing legal proceedings, including representative litigation pending in Singapore and US litigation involving the Securities and Exchange Commission.”

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Following the crash of Terra in May 2022, Kwon went on the run.

Interpol issued a red notice in September that year, days after South Korean courts issued an arrest warrant for Kwon.

Despite being an international fugitive, Kwon registered a company in Serbia under his own name together with Han Chang Joon in October 2022, according to official records obtained from the Serbian Business Registry by DL News in March.

$1 company

The company has an address listed in the old town of Belgrade, the Serbian capital. The duo only paid 100 Serbian dinars, which is less than one dollar, to set up the firm.

The company is still up and running even after Kwon and Chang-Joon were arrested at the Podgorica airport and subsequently incarcerated in March.

They were trying to escape to Dubai on a private jet with fake passports from Costa Rica. In June, they were convicted of using false papers.

You do not have “to delete a business entity from the register if the founders of that company, who are foreign nationals, are arrested, convicted or under extradition proceedings,” officials from the registry told DL News.

Kwon is still the sole owner, but both he and Chang-Joon are listed as directors, according to information from the Serbian Business Registry.

Screenshot of the Serbian Business Registry on January 23rd, 2024

So, if a criminal conviction against the founders and prosecutors in several countries gunning for the directors isn’t enough to close the company, what is?

“In order for the company to be deleted from the register, a voluntary liquidation procedure must be carried out,” the register’s press office told DL News.

If no such voluntary liquidation has been asked for, which there hasn’t, according to the register, then it’s a matter of time.

If the firm fails to send in its financial statements two years in a row, then the registry can start the process of unregistering the firm.

So far, Codokoj22 d.o.o. Beograd has missed sending in one such statement. In other words, the firm can still be up and running until the end of 2025.

Goran Rodic, Do Kwon’s lawyer in Montenegro, told DL News that he doesn’t know anything about what Kwon plans to do with the Serbian company.

Have tips about crypto enforcement matters? Contact the author at ana@dlnews.com.

This story was updated on January 30 to include Terraform Labs’ additional comments.