Do Kwon, the former CEO of Singapore’s Terraform Labs, appeared in a New York court this Tuesday and admitted to committing fraud in relation to the dramatic collapse of two cryptocurrencies, TerraUSD and Luna. The crisis, which occurred in 2022, resulted in significant losses for investors, surpassing $40 billion.
Kwon pleaded guilty to two counts and agreed to a plea deal limiting his potential sentence to 12 years. However, the judge noted he could still impose a longer sentence. Kwon’s misrepresentation led to a surge in investor interest in Terraform’s offerings, falsely assuring them of the stability of the TerraUSD stablecoin.
He initially evaded capture, fleeing from South Korea but was apprehended in Montenegro before being extradited to the U.S. In court, he acknowledged making misleading statements and expressed remorse for his actions. Kwon faces additional charges in South Korea as part of a broader inquiry, and has agreed to forfeit nearly $19.3 million in assets.
