Crypto mogul Do Kwon sentenced to 15 years in prison

Crypto mogul Do Kwon sentenced to 15 years in prison

Do Kwon, the South Korean cryptocurrency entrepreneur behind two digital currencies that misplaced an estimated $40 billion in 2022, was sentenced in New York federal court docket on Thursday to 15 years in prison for fraud and conspiracy.

Kwon, 34, who co-founded Singapore-based Terraform Labs and developed the TerraUSD and Luna currencies, beforehand pleaded responsible and admitted to deceptive traders about a coin that was supposed to keep a gentle value during intervals of crypto market volatility.

Kwon was one among a number of cryptocurrency moguls to face federal costs after a stoop in digital token costs in 2022 prompted the collapse of various firms. US District Judge Paul A. (*15*) handed down the sentence at a listening to in Manhattan.

Crypto Mogul Do Kwon, shown in 2023, was sentenced in New York federal court docket on Thursday to 15 years in prison for fraud and conspiracy. REUTERS

Prosecutors had requested for a sentence of a minimum of 12 years in prison, saying the crash of Kwon’s Terra cryptocurrency brought about billions of {dollars} in losses and triggered a cascade of crises in the crypto market. Kwon’s attorneys had requested that he be sentenced to no more than 5 years so he can return to South Korea to face felony costs.

Prosecutors charged Kwon in January with 9 felony counts for securities fraud, wire fraud, commodities fraud and cash laundering conspiracy.

Kwon was accused of deceptive traders in 2021 about TerraUSD, a so-called stablecoin designed to keep a worth of $1.

Prosecutors alleged that when TerraUSD slipped below its $1 peg in May 2021, Kwon told traders a pc algorithm often known as “Terra Protocol” had restored the coin’s worth.

Kwon in custody in Montenegro in 2024. AP

Instead, Kwon organized for a high-frequency buying and selling agency to secretly purchase thousands and thousands of {dollars} of the token to artificially prop up its value, according to charging paperwork.

Kwon pleaded responsible in August to two counts, conspiracy to defraud and wire fraud, and apologized in court docket for his conduct.

“I made false and misleading statements about why it regained its peg by failing to disclose a trading firm’s role in restoring that peg,” Kwon said. “What I did was wrong.”

Kwon agreed in 2024 to pay $80 million as a civil high quality and be banned from crypto transactions as a part of a $4.55 billion settlement he and Terraform reached with the Securities and Exchange Commission.

He also faces costs in South Korea. As a part of his plea deal, prosecutors won’t oppose Kwon’s potential application to be transferred overseas after serving half his US sentence.

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