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 to many as the ‘Cryptocurrency King’, has pleaded guilty to conspiracy to defraud and wire fraud. Kwon, the mastermind behind the cryptocurrencies TerraUSD and Luna, has admitted to his role in the massive fraud that led to a loss of $40 billion (approximately ₹3.5 lakh crore) in 2022.
Terraform Labs, the company co-founded by Kwon, was at the center of the controversy. The company’s collapse sent shockwaves through the cryptocurrency market, causing widespread financial losses and leaving investors reeling. The magnitude of the fraud is still difficult to comprehend, with estimates suggesting that over 1 million people were affected worldwide.
Kwon’s guilty plea comes as a significant blow to the cryptocurrency community, which had long revered him as a visionary and a pioneer in the field. However, behind the scenes, Kwon’s actions had been shrouded in controversy, with many accusing him of manipulating the market and using his platform to line his own pockets.
The charges against Kwon were serious, with the US Department of Justice accusing him of orchestrating a massive scheme to defraud investors of their funds. The scheme allegedly involved the use of shell companies, fake identities, and other fraudulent tactics to launder millions of dollars in ill-gotten gains.
As part of his plea deal, Kwon has agreed to cooperate with the authorities and to forfeit millions of dollars in assets. In return, he may face a reduced sentence of 12 years, down from the maximum 25 years he could have faced if convicted at trial.
Kwon’s fall from grace is a stark reminder of the dangers of unchecked ambition and the importance of regulatory oversight in the cryptocurrency space. While many had hailed Kwon as a genius, others had long warned about the risks associated with his projects.
TerraUSD, also known as UST, was a stablecoin designed to maintain a stable value relative to other cryptocurrencies. However, the coin’s value collapsed in May 2022, causing a chain reaction that led to the downfall of Luna, a cryptocurrency that was pegged to UST.
The collapse of TerraUSD and Luna sent shockwaves through the cryptocurrency market, causing widespread panic and confusion. Investors who had put their faith in Kwon’s projects were left with significant losses, and many were left wondering how they had been duped by the charismatic entrepreneur.
In the aftermath of the collapse, regulators and lawmakers around the world scrambled to respond to the crisis. The US Securities and Exchange Commission (SEC) launched an investigation into Kwon’s activities, and several other countries followed suit.
The guilty plea is a significant milestone in the ongoing legal saga surrounding Kwon and his companies. The case is a stark reminder of the importance of accountability in the cryptocurrency space and the need for regulators to take a closer look at the activities of some of the industry’s most prominent players.
As the dust settles on the scandal, it is clear that Kwon’s legacy is forever tarnished. The ‘Cryptocurrency King’ has fallen, and the cryptocurrency community is left to pick up the pieces.
