A US federal court has decided to postpone a crucial hearing in the case against Do Kwon, co-founder of Terraform Labs, following the submission of a significant amount of new evidence by prosecutors. The hearing, originally scheduled for March 10 in the Southern District of New York, has now been rescheduled to April 10.
The reason for the postponement was the extensive amount of new evidence provided by prosecutors, totaling four terabytes of discovery. The court agreed with the prosecution’s argument that the defense needed more time to analyze the voluminous amount of information, which included data from Kwon’s cellphones, emails, and crypto transactions. An additional four terabytes of discovery is expected to be handed over to Kwon’s legal team next week.
Despite the delay in the hearing, the jury trial is still set to take place on January 26, 2026. Victims of the Terraform Labs collapse have until April 30 to submit claims for financial losses incurred.
The postponement of Kwon’s case adds further complexity to an already high-profile legal battle. With a large volume of discovery materials to review, Kwon’s defense team faces a challenging road ahead as they prepare for trial.
Federal prosecutors have accused Kwon of knowingly misrepresenting the stability of Terraform’s ecosystem, which led to a significant financial downturn in the crypto market. However, Kwon maintains his innocence and asserts that the market downturn was unforeseen and not the result of fraudulent activity.
Kwon, who was extradited from Montenegro to the US on December 31, 2024, pleaded not guilty to multiple fraud-related charges on January 2. The charges stem from the collapse of Terraform Labs’ algorithmic stablecoin, TerraUSD, which resulted in approximately $40 billion in investor losses in 2022.
In addition to the criminal case, Terraform Labs has also been under scrutiny by the Securities and Exchange Commission (SEC) for alleged large-scale crypto fraud. In April 2024, a jury found Kwon and Terraform Labs liable for defrauding investors in crypto asset securities. The SEC requested $5.3 billion in disgorgement and civil penalties, which the court ultimately reduced to a $4.5 billion fine against both Kwon and Terraform Labs.
The legal battle between Do Kwon, Terraform Labs, and the authorities continues to unfold, with the postponed hearing and upcoming trial adding further complexity to the case.