Do Kwon Pleads Guilty in $40 Billion TerraUSD Crypto Collapse Case
Do Kwon, the South Korean entrepreneur behind Terraform Labs and the notorious TerraUSD and Luna cryptocurrencies, has made a significant legal shift by pleading guilty to U.S. charges involving conspiracy to defraud and wire fraud. These charges relate to the dramatic $40 billion collapse of these cryptocurrencies in 2022, which sent shockwaves across the crypto market.
Initially, Kwon had pleaded not guilty to a nine-count indictment in January, which included serious accusations such as securities fraud, commodities fraud, and conspiracy for money laundering. U.S. prosecutors accused him of misleading investors in 2021 by claiming TerraUSD’s value was secured through an algorithmic stabilization mechanism. However, they allege that Kwon secretly used a high-frequency trading firm to inflate the coin's value, leading to an artificial surge in Luna's worth up to $50 billion by early 2022.
In 2024, Kwon reached a settlement with the Securities and Exchange Commission (SEC) to pay an $80 million fine and accept a ban on crypto transactions. This agreement was part of a larger $4.55 billion settlement addressing the fallout from this collapse.
Kwon has been in U.S. custody since his extradition from Montenegro and stands among several crypto industry leaders facing legal consequences after the 2022 market downturn.
For crypto enthusiasts looking to invest wisely and avoid risks from volatile projects, platforms like Bitlet.app offer a more secure approach. Bitlet.app’s Crypto Installment Service enables users to buy cryptocurrencies by paying monthly instead of investing a lump sum upfront, providing an accessible and manageable way to enter the crypto market.
Stay informed and cautious while navigating the evolving crypto landscape with resources like Bitlet.app.