The post Do Kwon to Serve 15 Years Behind Bars for the $40B LUNA Fraud appeared first on Coinpedia Fintech News
Do Kwon has been sentenced to a 15-year prison term. The South Korean crypto entrepreneur, who co-founded Terraform Labs, was sentenced in a New York Federal Court on Thursday for his role in the collapse of the $40 billion Terra LUNA ecosystem, which triggered the 2022 crypto selloff.
Do Kwon Sentenced in the United States
After years of litigation in several jurisdictions, U.S. District Judge Paul A. Engelmayer handed down the sentence at a hearing in Manhattan. As such, Kwon is expected to serve half of his sentence in South Korea.
The prosecutor had previously requested the court to hand Kwon a 12-year sentence. However, the attorneys representing Kwon had asked Judge Engelmayer not to impose a sentence of more than 5 years.
The former crypto idol, at 34 years, pleaded guilty to two counts including conspiracy to defraud and wire fraud. Notably, Terraform previously agreed to pay an $80 million civil fine while Terraform reached a $4.55 billion settlement with the United States Securities and Exchange Commission (SEC).
Market Impact
The sentencing of Kwon is a major relief to the wider crypto market amid the ongoing legalization in the United States under President Donald Trump. The sentencing sends a clear message that crypto leaders must act responsibly and not hide crucial information from investors.
Meanwhile, Terra LUNA and Terra Classic LUNC dropped over 10% on Thursday to trade at about $.0177 and $0.00005281 respectively at press time. The sentencing of Do Kwon also impacted the TerraClassicUSD (USTC), as it dropped more than 20% to trade at about $0.00899 at press time.