Technology mogul Do Kwon pleads guilty to deceit over crash that impacted $40bn marketplace

Do Kwon, a South Korean entrepreneur behind Terraform Labs and the cryptocurrencies TerraUSD and Luna, pleaded guilty on Tuesday to two charges of conspiracy to defraud and wire fraud in the United States. The scandal led to the cryptocurrency market imploding and caused an estimated $40 billion loss in 2022. Kwon faces up to 25 years in prison but may receive a maximum of 12 years if he accepts responsibility for his crimes. He and Terraform Labs allegedly misled investors in 2021 by claiming a computer algorithm, the Terra Protocol, had restored TerraUSD’s value when it temporarily slipped below its $1 peg. Prosecutors said Kwon also secretly arranged for a trading firm to buy millions of dollars of TerraUSD to artificially inflate its price, leading to the value of Luna rising to $50 billion by spring 2022. Kwon has been detained since his extradition from Montenegro. He also faces charges in South Korea and must pay an $80 million fine and be banned from future cryptocurrency transactions as part of a $4.55 billion settlement he and Terraform reached with the U.S. Securities and Exchange Commission.

Source: https://www.theguardian.com/technology/2025/aug/12/crypto-do-kwon-fraud-guilty