Terra Founder Do Kwon Seeks Five-Year Prison Deal Ahead of December 11 Sentencing Showdown

Terra's fallen architect makes his final move before judgment day.

The Plea Bargain Gambit

Do Kwon's legal team just played their sentencing card—proposing a five-year confinement deal that would see the Terra founder serving time until 2030. The December 11 courtroom drama now carries extra weight as prosecutors weigh whether to call his bluff.

Timing Is Everything

With sentencing barely two weeks away, this strategic move reeks of calculated desperation. Kwon's lawyers clearly want to control the narrative before the judge drops the hammer—because when you've presided over a $40 billion ecosystem collapse, you don't leave these things to chance.

The Regulatory Reckoning

Global watchdogs are watching this case like hawks, knowing the outcome could set precedent for every crypto founder who ever thought 'decentralized' meant 'unaccountable.' Five years might sound light for vaporizing retail investors' life savings—but in crypto time, that's practically three market cycles.

Sometimes the brightest minds in blockchain end up designing their own prison cells—the ultimate centralized architecture.

Terra’s Do Kwon Says Five Years In Prison Will Suffice

On Wednesday, Terraform Labs’ co-founder and former CEO, Do Kwon, requested a maximum five-year prison term for his involvement in the $40 billion collapse of TerraUSD (UST) stablecoin in 2022.

According to the sentencing recommendation reviewed by Bloomberg, Kwon’s legal team affirmed that the Terraform co-founder should receive a five-year sentence, as he has already spent nearly three years locked up, “with more than half that time in brutal conditions in Montenegro.”

The former CEO’s lawyers argued that he had “suffered substantially for his crimes,” and the requested prison term WOULD suffice, adding that the prosecutor’s expected recommendation of a 12-year sentence is “‘far greater than necessary’ to achieve justice.”

Moreover, the court filing reportedly stressed that Kwon had already agreed to forfeit more than $19 million and some properties as part of the August plea deal. As reported by Bitcoinist, Kwon pleaded guilty in August to two of the nine charges indicted by US authorities.

Notably, he initially pleaded not guilty in January to a nine-count indictment that charged him with securities fraud, wire fraud, commodities fraud, and conspiracy to commit money laundering. However, he changed his stance in August, pleading guilty to conspiracy to defraud and wire fraud.

At the time, Kwon also apologized for his actions, affirming that he “made false and misleading statements” about why TerraUSD regained its peg in 2021 by “failing to disclose a trading firm’s role in restoring that peg,” adding, “What I did was wrong.”

Prosecutors are expected to file their sentencing recommendation soon. As part of the plea deal, they previously agreed not to seek more than 12 years in prison for the Terraform Labs co-founder. The sentencing by US District Judge Paul Engelmayer is scheduled for December 11, 2025, in Manhattan.

South Korea’s Prosecution Pending

In the sentencing recommendation, Kwon’s lawyers stressed that the former CEO still faces trial in his home country, South Korea, for the same conduct, noting that local prosecutors there are seeking a prison term of up to 40 years.

Following the collapse of Terraform Labs, both South Korean and US authorities sought to bring Kwon to justice. Nonetheless, he had been on the run for months, fleeing his home country and Singapore ahead of the company’s downfall.

In March 2023, Montenegrin authorities detained him along with Terraform Lab’s former finance officer, Han Chang-joon, for trying to travel with fake documents at the Podgorica Airport. Notably, Kwon was under Montenegro’s custody for over a year and a half and faced a four-month sentence, later receiving an extra two months at the request of the US and South Korea.

The two countries entered a prolonged battle to bring the crypto entrepreneur to trial in each country. Initially, Montenegrin authorities approved South Korea’s extradition request, but he was ultimately extradited to the US on December 31, 2024, after Montenegro’s interior ministry signed their request.