Crypto King’ Do Kwon, behind TerraUSD & Luna, pleads guilty to ₹3.5-lakh-crore fraud
In a shocking turn of events, South Korean entrepreneur Do Kwon, known by some as the ‘Cryptocurrency King’, has pleaded guilty to conspiracy to defraud and wire fraud. Kwon, the co-founder of Terraform Labs, was behind the cryptocurrencies TerraUSD (UST) and Luna, which lost a staggering $40 billion (approximately ₹3.5 lakh crore) in 2022.
The crisis surrounding TerraUSD and Luna sent shockwaves through the cryptocurrency market, leaving many investors and users affected. The collapse of the two cryptocurrencies led to a massive loss of value, with some investors reporting losses of up to 100%.
Do Kwon’s guilty plea is a significant development in the ongoing legal proceedings against him. The entrepreneur faced up to 25 years in prison for his alleged involvement in the fraud. However, with his admission of guilt, his sentence may be reduced to 12 years.
According to reports, Kwon’s plea deal was reached after intense negotiations with prosecutors. The exact terms of the agreement have not been disclosed, but it is expected that Kwon will serve a significant sentence in prison.
The case against Do Kwon began in June 2022, when the US Department of Justice (DOJ) charged him with conspiracy to commit wire fraud and securities fraud. The charges stemmed from allegations that Kwon and his co-conspirators had engaged in a scheme to defraud investors by promoting the TerraUSD and Luna cryptocurrencies as stablecoins, which were pegged to the value of the US dollar.
However, the collapse of the two cryptocurrencies in May 2022 revealed that the scheme was a sham. The value of TerraUSD and Luna plummeted, wiping out the assets of investors and causing widespread financial losses.
The fallout from the collapse of TerraUSD and Luna was swift and severe. The cryptocurrency market was sent into a tailspin, with many investors reporting significant losses. The collapse also led to a loss of confidence in the stability of the cryptocurrency market as a whole.
Do Kwon’s guilty plea is a significant blow to the cryptocurrency community, which had previously been enthusiastic about the potential of TerraUSD and Luna. The collapse of the two cryptocurrencies has raised questions about the regulatory environment for cryptocurrencies and the potential for fraud in the industry.
The case against Do Kwon has also highlighted the need for greater regulation and oversight of the cryptocurrency market. Many experts have called for greater scrutiny of cryptocurrency exchanges and the imposition of stricter regulations to prevent fraud and protect investors.
In a statement, the US Attorney’s Office for the Southern District of New York said: “Today’s guilty plea marks a significant step in holding accountable those who engage in fraudulent schemes that victimize investors and undermine trust in the financial system.”
The statement added: “The defendant’s actions caused immense financial harm to countless individuals and businesses, and his guilty plea is a reminder that those who engage in fraud will be held accountable.”
The case against Do Kwon is ongoing, with his sentencing hearing scheduled for later this year. The exact sentence he will serve has not been disclosed, but it is expected to be significant.
As the cryptocurrency market continues to evolve, the case against Do Kwon serves as a stark reminder of the risks and challenges associated with investing in cryptocurrencies. It is essential for investors to remain vigilant and to conduct thorough research before investing in any cryptocurrency or investment scheme.
In conclusion, Do Kwon’s guilty plea is a significant development in the ongoing legal proceedings against him. The entrepreneur’s admission of guilt marks a significant step in holding accountable those who engage in fraudulent schemes that victimize investors and undermine trust in the financial system.
The case against Do Kwon serves as a reminder of the importance of regulatory oversight and the need for greater scrutiny of the cryptocurrency market. It is essential for investors to remain vigilant and to conduct thorough research before investing in any cryptocurrency or investment scheme.
