Do Kwon Sentenced to 15 Years for Terra Fraud as Judge Denounces ’Despicable’ Scheme
Terraform Labs co-founder Do Kwon received a 15-year prison sentence Wednesday for wire fraud and conspiracy, marking a dramatic conclusion to one of crypto's most notorious collapse cases. The ruling by Judge Paul Engelmayer exceeded both prosecution and defense recommendations, with the court calling the May 2022 Terra implosion that vaporized $40-50 billion in market value a 'despicable' betrayal of investor trust.
Six victims delivered emotional testimony during the sentencing hearing, representing a fraction of the 16,500 claimants documented in Terraform's bankruptcy proceedings. Kwon's sentence includes a potential transfer to South Korea after serving half his term, where additional charges await that could extend his imprisonment by decades.
The verdict closes a chapter that began when Terra's algorithmic stablecoin UST lost its peg in May 2022, triggering a death spiral that erased billions across crypto markets. At the time, Kwon maintained a lavish lifestyle in Singapore while retail investors faced financial ruin—a contrast that fueled regulatory crackdowns on stablecoins worldwide.
