Do Kwon pleads guilty to US fraud charges in US$40 billion crypto collapse
The South Korean founder of Singapore-based Terraform Labs was behind the TerraUSD and Luna digital currencies
Do Kwon, the South Korean cryptocurrency entrepreneur behind two digital currencies that lost an estimated US$40 billion in 2022, pleaded guilty on Tuesday to two US charges of conspiracy to defraud and wire fraud.
Kwon, 33, who co-founded Singapore-based Terraform Labs and developed the TerraUSD and Luna currencies, entered the plea at a court hearing in New York before US District Judge Paul Engelmayer.
He had pleaded not guilty in January to a nine-count indictment charging him with securities fraud, wire fraud, commodities fraud and money-laundering conspiracy.
Accused of misleading investors in 2021 about TerraUSD – a so-called stablecoin designed to maintain a value of US$1 – Kwon pleaded guilty to the two counts under an agreement with the Manhattan US Attorney’s office, which brought the charges.
He faces up to 25 years in prison when Engelmayer sentences him on December 11, though prosecutor Kimberly Ravener said the government had agreed to advocate for a prison term of no more than 12 years provided he accepts responsibility for his crimes.
Kwon is one of several cryptocurrency moguls to face federal charges after a slump in digital token prices in 2022 prompted the collapse of a number of companies.