Crypto King’ Do Kwon, behind TerraUSD & Luna, pleads guilty to ₹3.5-lakh-crore fraud
In a major development, Do Kwon, the South Korean entrepreneur dubbed by some as the ‘Cryptocurrency King’, has pleaded guilty to conspiracy to defraud and wire fraud. Kwon, who co-founded Terraform Labs and was behind the cryptocurrencies TerraUSD (UST) and Luna, faced a maximum of 25 years in prison for his alleged crimes. However, with his guilty plea, his sentence may be reduced to 12 years.
Kwon’s downfall began in May 2022, when the value of his cryptocurrencies TerraUSD and Luna plummeted, resulting in a loss of nearly ₹3.5 lakh crore ($40 billion). The collapse of the Terra ecosystem sent shockwaves through the global cryptocurrency market, leaving investors and traders reeling.
The charges against Kwon were filed in December 2022 by the US Department of Justice, which accused him of orchestrating a massive fraud scheme. According to the indictment, Kwon and his co-conspirators manipulated the market for TerraUSD and Luna, artificially inflating their value and then cashing in on the gains.
The scheme was allegedly designed to take advantage of the lack of oversight and regulation in the cryptocurrency market, which allowed Kwon to conceal his true intentions and manipulate the market to his advantage.
As part of his guilty plea, Kwon admitted to conspiring with his co-conspirators to defraud investors and to using wire transfers to facilitate the fraud. He also admitted to misrepresenting the financial health and stability of the Terra ecosystem, and to using false and misleading statements to convince investors to buy into his scheme.
The plea deal is a significant development in the case, as it suggests that Kwon has acknowledged his guilt and is willing to cooperate with authorities. The reduced sentence of 12 years is a significant reduction from the maximum 25 years that Kwon faced.
Kwon’s guilty plea is a major blow to the cryptocurrency community, which had long admired him as a visionary and a pioneer in the field. His rise to fame was meteoric, and he was hailed as a genius for creating a stablecoin that was pegged to the value of the US dollar.
However, his fall from grace was just as rapid. The collapse of the Terra ecosystem sent shockwaves through the global financial system, and many investors and traders were left reeling.
The case against Kwon is a significant development in the ongoing regulatory debate around cryptocurrencies. The collapse of the Terra ecosystem has raised questions about the lack of oversight and regulation in the cryptocurrency market, and the extent to which it is possible to manipulate the market.
The case is also a reminder of the risks and uncertainties involved in investing in cryptocurrencies. While they can offer high returns, they can also be highly volatile and subject to manipulation.
In conclusion, Do Kwon’s guilty plea is a significant development in the case against him, and it highlights the risks and uncertainties involved in investing in cryptocurrencies. As the cryptocurrency market continues to evolve, it is essential that investors and traders are aware of the potential risks and take steps to protect themselves.
Source:
