A US courtroom yesterday (Thursday) sentenced Do Kwon, the co-founder of Terraform Labs, to fifteen years in jail after he pleaded responsible to wire fraud and conspiracy to defraud buyers. The collapse of Terraform Labs worn out $40 billion in buyers’ cash.
One other Crypto Mogul Goes to Jail
In accordance with the order of Choose Paul Engelmayer on the US District Court docket for the Southern District of New York, Kwon will obtain credit score for time served within the US and 17 months of pre-extradition custody.
Earlier than the sentencing, the choose additionally heard from a few of the victims of Terraform. Kwon additionally testified in courtroom earlier than the sentencing.
“I would love everybody to know that I’ve spent all my time fascinated with what I may have achieved, and what I can do,” Kwon mentioned earlier than the sentencing. “It’s been 4 years because the crash, three years since I’ve seen my household. I’d wish to [do] my penance in my dwelling nation.”
Do Kwon: I would love everybody to know that I’ve spent all my time considering what I may have achieved, and what I can do. It has been 4 years because the crash, three years since I’ve seen my household. I would wish to my penance in my dwelling nation.
— Interior Metropolis Press (@innercitypress) December 11, 2025
He’s additionally going through fraud prices in South Korea, his dwelling nation.
The Collapse that Dented the Crypto Business
Kwon was identified for founding Terraform Labs. Nevertheless, the undertaking’s two cryptocurrencies, TerraUSD and Luna, collapsed in 2022, erasing about $37 billion in worth. The autumn of the algorithmic stablecoin led to the closure and downfall of a number of different cryptocurrency firms.
In 2023, Kwon and an affiliate have been arrested in Montenegro whereas making an attempt to journey to Dubai utilizing pretend journey paperwork. He was then extradited to the US, whereas South Korea was additionally making an attempt to push his extradition.
In June, Terraform Labs and Kwon agreed to a settlement with the US Securities and Alternate Fee (SEC), committing to pay round $4.5 billion in restoration and civil penalties. Kwon personally agreed to pay no less than $204.3 million.
At first, the US regulator sought $5.3 billion in settlement. Nevertheless, the defendants’ authorized workforce countered with a suggestion of $1 million in civil penalties and no restoration or injunction.
Moreover, Kwon and Terraform Labs have been completely banned from shopping for or promoting crypto asset securities, together with tokens within the Terra ecosystem.
Earlier this yr, Terraform Labs filed for chapter in Delaware, United States. Within the courtroom submitting, the defunct firm reported liabilities between $100 million and $500 million, with estimated property in the identical vary.
After the sentencing, Kwon joined FTX founder and former CEO Sam Bankman-Fried, who obtained a 25-year jail sentence.
This text was written by Arnab Shome at www.financemagnates.com.
Source link
