{"id":41870,"date":"2025-08-13T06:01:30","date_gmt":"2025-08-13T06:01:30","guid":{"rendered":"https:\/\/dogewisperer.com\/?p=41870"},"modified":"2025-08-13T06:01:30","modified_gmt":"2025-08-13T06:01:30","slug":"do-kwons-guilty-plea-in-us-fraud-case-sets-stage-for-25-year-sentence","status":"publish","type":"post","link":"https:\/\/dogewisperer.com\/?p=41870","title":{"rendered":"Do Kwon\u2019s Guilty Plea In US Fraud Case Sets Stage For 25-Year Sentence"},"content":{"rendered":"
\n

Do Kwon, co-founder of the defunct blockchain firm Terraform Labs, has pleaded guilty to US fraud charges after a tumultuous three years following the company\u2019s collapse.<\/p>\n

Do Kwon, who took part in creating and developing the TerraUSD stablecoin and the Luna (now Luna Classic) token lost an estimated $40 billion in value in 2022, entered his plea during a court hearing in New York on Tuesday.<\/p>\n

Do Kwon Admits Guilt In Conspiracy And Wire Fraud Case<\/h2>\n

Kwon faced serious allegations stemming from a nine-count indictment that included securities fraud, wire fraud, commodities fraud, and conspiracy to commit money laundering, according to US authorities.\u00a0<\/p>\n

As reported <\/a>by Bitcoinist on Monday, after initially pleading not guilty in January, he ultimately changed his stance, agreeing to plead guilty to two charges: conspiracy to defraud and wire fraud as part of a deal with the Manhattan US Attorney\u2019s office.<\/p>\n

The charges against Kwon were primarily related to misleading investors about TerraUSD, a stablecoin intended to be pegged to the US dollar.\u00a0Prosecutors allege that when TerraUSD <\/a>fell below its peg in May 2021, Kwon falsely assured investors that a computer algorithm known as \u201cTerra Protocol\u201d would restore the coin\u2019s value.\u00a0<\/p>\n

Authorities claim that in reality, Do Kwon had \u201csecretly arranged for\u201d a high-frequency trading firm to buy millions of dollars\u2019 worth of the token to artificially inflate its price and recover its value pegged to the dollar.<\/p>\n

This behavior led both retail and institutional investors<\/a> to purchase Terraform products, inflating the value of Luna\u2014a cryptocurrency closely tied to TerraUSD\u2014to as much as $50 billion by early 2022.<\/p>\n

Banned From Crypto As Part Of SEC Settlement<\/h2>\n

During the court proceedings, Kwon expressed <\/a>remorse for his actions, admitting, \u201cI made false and misleading statements about why it regained its peg by failing to disclose a trading firm\u2019s role in restoring that peg. What I did was wrong.\u201d<\/p>\n

As part of his legal troubles, Kwon has agreed to pay an $80 million civil fine and will be banned from engaging in crypto transactions as part of a broader $4.55 billion settlement with the US Securities and Exchange Commission.\u00a0<\/p>\n

Do Kwon, has been in custody since his extradition from Montenegro late last year by US authorities is also facing charges <\/a>in South Korea on conspiring to commit commodities fraud, securities fraud, and wire fraud<\/p>\n

Looking ahead, the crypto entrepreneur faces a potential prison sentence of up to 25 years, although prosecutors indicated they would recommend a maximum term of 12 years, contingent on Kwon accepting responsibility for his actions. Sentencing is scheduled for December 11.\u00a0<\/p>\n

\"Do<\/p>\n

Following Do Kwon\u2019s fall, Luna Classic recorded an 8% uptick on the weekly time frame. This recovery reached the $0.00006284 level after months of continuous drops from its yearly high of $0.00012, which was reached in January.<\/p>\n

Featured image from DALL-E, chart from TradingView.com\u00a0<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Do Kwon, co-founder of the defunct blockchain firm Terraform Labs, has pleaded guilty to US fraud charges after a tumultuous three years following the company\u2019s collapse. Do Kwon, who took part in creating and developing the TerraUSD stablecoin and the Luna (now Luna Classic) token lost an estimated $40 billion in value in 2022, entered […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"iawp_total_views":0,"footnotes":""},"categories":[2],"tags":[3,4,5],"class_list":["post-41870","post","type-post","status-publish","format-standard","hentry","category-news","tag-crypto","tag-doge","tag-news"],"_links":{"self":[{"href":"https:\/\/dogewisperer.com\/index.php?rest_route=\/wp\/v2\/posts\/41870","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/dogewisperer.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/dogewisperer.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/dogewisperer.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/dogewisperer.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=41870"}],"version-history":[{"count":0,"href":"https:\/\/dogewisperer.com\/index.php?rest_route=\/wp\/v2\/posts\/41870\/revisions"}],"wp:attachment":[{"href":"https:\/\/dogewisperer.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=41870"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/dogewisperer.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=41870"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/dogewisperer.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=41870"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}