Do Kwon Admits Guilt to Fraud in Terra USD Failures: Agreement Reduces 150-Year Sentence to 25 Years

The disgraced crypto entrepreneur responsible for the significant downfall of Terra, Do Kwon, has acknowledged his involvement in wire fraud and conspiracy to defraud in one of the industry’s greatest scandals.

Do Kwon, co-founder of Terraform Labs and once a prominent figure in the crypto space behind the troubled Terra USD stablecoin, has entered a guilty plea to two fraud charges in a federal court in New York, as reported by Reuters.

This plea marks another milestone in a protracted legal battle that has captivated the digital asset community since Terra’s disastrous collapse in 2022. It may lessen his potential sentence from 150 years to merely 25 years in confinement.

Do Kwon’s Shift from Crypto Fugitive to Plea in Court

Kwon, age 33, confessed to wire fraud and conspiracy to defraud, foregoing his right to a trial and accepting a possible sentence of up to 25 years behind bars.

This week, U.S. District Court Judge Paul Engelmayer affirmed that the court had been informed that Kwon was expected to change his plea. This development concludes months of uncertainty over whether the ex-CEO would contest the allegations.

The criminal proceedings originated from the collapse of Terra USD (UST), an algorithmic stablecoin intended to maintain its value through a connected governance token, Luna.

The system’s failure in May 2022 resulted in a rekt exceeding $40 billion and a contagion that affected numerous significant crypto companies.

Kwon was accused by prosecutors of deceiving investors and manipulating the trading market, prompting both U.S. and South Korean authorities to pursue his arrest.

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From Arrest in Montenegro to Guilty Plea in the U.S.

Following months of evading authorities, Kwon was apprehended in Montenegro in March 2023 for using false documents.

He was extradited, after a protracted dispute with South Korea, to the United States in December 2024 and initially pleaded not guilty in January 2025.

His guilty plea comes on the heels of an April civil fraud ruling where a jury determined that Kwon and Terraform Labs misled investors, breaching federal securities laws.

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The post Do Kwon Pleads Guilty to Fraud in Terra USD Collapses: Deal Cuts 150 Years to 25 Years Sentence appeared first on 99Bitcoins.