'Cryptocrash king' Do Kwon pleads guilty to fraud

Do Kwon, a former technology executive from South Korea, appeared in a New York court wearing a yellow prison jumpsuit to plead guilty to fraud charges. He was the head of Terraform Labs, a company based in Singapore that created two cryptocurrencies, TerraUSD and Luna. In 2022, both of these digital currencies collapsed, causing investors to lose more than $40 billion. The United States government accused Do Kwon of being responsible for the failure of these coins and said he planned a huge fraud involving crypto assets. Prosecutors claimed that Do Kwon misled investors about how TerraUSD was supposed to keep its value at $1. He told people that a computer program called Terra Protocol would keep the coin stable, but in reality, he secretly arranged for a trading firm to buy millions of dollars worth of TerraUSD to make it look like the coin was safe. This trick made many investors buy Terraform’s coins, which helped increase the value of Luna, another cryptocurrency linked to TerraUSD.

After the crash, Do Kwon left South Korea and traveled to other countries. He ended up in Montenegro, where he was arrested and later sent to the United States. In court, Do Kwon admitted that he made false and misleading statements about why TerraUSD regained its value. He said, 'What I did was wrong and I want to apologize for my conduct. ' At first, Do Kwon pleaded not guilty to nine charges, including securities fraud, wire fraud, and conspiracy to launder money. If he had been found guilty of all the charges, he could have faced up to 135 years in prison. However, as part of a plea deal, prosecutors agreed not to ask for more than 12 years in jail. Do Kwon also agreed not to challenge the charges and must give up up to $19. 3 million, plus interest, and several properties. He will also have to pay restitution to those who lost money. The judge said he could still give Do Kwon up to 25 years in prison, even though prosecutors will only ask for 12 years. Do Kwon is scheduled to be sentenced on December 11.

Todd Snyder, who was appointed by US authorities and Terraform Labs to oversee the company’s liquidation, said that Do Kwon’s guilty plea shows how important it is for people in the digital asset industry to be held accountable. He promised that the company would try to recover assets for the people who lost money. The collapse of TerraUSD and Luna caused a wider sell-off in the crypto market, affecting many other cryptocurrencies. This case is a warning to investors and companies in the digital currency world that honesty and transparency are very important. Do Kwon still faces charges in South Korea, according to his lawyer. The story of Do Kwon and Terraform Labs is a reminder that investing in new technologies like cryptocurrencies can be risky, and people should be careful before putting their money into these markets.