Terraform Labs Co-Founder Pleads Guilty in $40 Billion TerraUSD Stablecoin Crash
Terraform Labs co-founder Do Kwon has pleaded guilty in a US fraud case related to the $40 billion TerraUSD stablecoin crash in 2022. This development comes after a hearing in New York where Kwon admitted to conspiracy and wire fraud charges as part of a deal with prosecutors.
Appearing in court in his yellow prison uniform, Kwon also agreed to pay a hefty $19.3 million fine and forfeit some of his assets as part of the plea agreement. In his statement, Kwon expressed remorse for his actions, acknowledging that he knowingly conspired to defraud buyers of cryptocurrencies issued by Terraform Labs.
Key Role in Crypto Crisis
Kwon, who was also indicted in both the US and South Korea, played a significant role in the crisis that unfolded following the collapse of TerraUSD. This event triggered major fluctuations in the crypto market in the spring of 2022 and ultimately led to the bankruptcy of the FTX exchange.
Potential Prison Sentence
As per the terms of the agreement with prosecutors, Kwon could face up to 12 years in prison if he refrains from committing any further crimes. The charges he pleaded guilty to carry a maximum sentence of up to 25 years under normal circumstances.
Kwon’s legal troubles began in 2023 when he was indicted in the US. After nearly two years on the run, he was captured in Montenegro using a fake passport. Kwon was subsequently extradited to the US in January following his sentencing, which facilitated an early resolution to the case and avoided a trial scheduled for the following year.
*Please note that this article does not constitute investment advice.