Do Kwon Sentenced to 15 Years for $40bn Terra-Luna Crypto Fraud

NEW YORK — Do Kwon, the 34-year-old South Korean behind the collapsed TerraUSD stablecoin and Luna token, was sentenced to 15 years in prison on Wednesday for orchestrating what a judge called an “epic, generational-scale fraud” that cost investors an estimated US$40 billion in 2022.

Terra-Luna Crypto Fraud

US District Judge Paul Engelmayer condemned Kwon for repeatedly lying to ordinary investors who lost life savings, Reuters said. Kwon, who co-founded Singapore-based Terraform Labs, pleaded guilty in August to conspiracy and wire fraud, admitting he secretly manipulated TerraUSD’s price in 2021 by arranging massive covert purchases when it slipped below its US$1 peg.

Dressed in yellow prison garb, Kwon apologised in court, saying victims’ harrowing stories reminded him of the immense harm he caused. Prosecutors sought at least 12 years; defence lawyers requested five. Kwon already agreed to a US$4.55 billion SEC settlement. He still faces charges in South Korea.

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