Crypto mogul Do Kwon pleads guilty to fraud for $40bn market collapse | Technology

Do Kwon, the South Korean entrepreneur behind two cryptocurrencies, who lost $ 40 billion in 2022 and prompted the market to implode.

The 33-year-old Kwon, the co-founder of Terraform Labs based in Singapore, who developed currencies of Terrusd and Luna, joined the plea in a hearing from the federal government in New York. In January in January, he had not guilty to describe an indictment for securities fraud, wire fraud, raw material fraud and money laundering conspiracy.

Kwon accuses of having misleading investors in 2021-a so-called stablecoin, which is supposed to maintain a value of $ 1-and known to the two charges as part of an agreement with the US public prosecutor's office in Manhattan, which received the indictment.

He is up to 25 years in prison when Engelmayer convicted him on December 11th, although the public prosecutor's office Kimberly Ravener said that the government had agreed to stand up for a prison sentence of no more than 12 years, provided that he takes responsibility for his crimes. He has been detained since he was delivered Montenegro At the end of last year.

Kwon is one of several cryptocurrency mogules that were triggered after a break -in of digital token prices in 2022 to collapse a number of companies. Sam Bankman friedThe founder of the largest crypto exchange in the United States, Ftxwas sentenced to 25 years in prison in 2024.

The prosecutors claimed when Terrusd slipped under his 1 -dollar -PEG in May 2021, Kwon said that a computer algorithm who is known as the “Terra protocol” restored the value of the coin. Instead, he arranged a high frequency trade company to secretly buy millions of dollars of the token to artificially support their price.

The prosecutors said that false claims and other retail and institutional investors prompted to buy terraform products and increase the value of Luna – a more traditional token that was fluctuated in value, but was associated with $ 50 billion to $ 50 billion in spring 2022.

In court, Kwon apologized for his behavior.

“I made false and misleading statements about why it regained its PEG by not disclosing the role of a trading company in the restoration of this PEGS,” said Kwon. “What I did was wrong.”

In 2024, Kwon agreed to pay 80 million US dollars as a civilian fine and to be banned by Krypto transactions as part of a USD 4.55 billion that he and Terraform achieved with the US Securities and Exchange Commission.

He is also charged in South Korea. As part of the deal, the prosecutors will not be able to transfer potential application to Kwon's potential application for the halves of his half of his US prison, said Ravener.