Do Kwon, the South Korean cryptocurrency entrepreneur behind two digital currencies that lost an estimated $40 billion in 2022, has been sentenced to 15 years in prison for what a judge called an epic fraud. US District Judge Paul A. Engelmayer delivered the sentence on Thursday, December 11, in Manhattan federal court and criticised Kwon for deceiving ordinary investors who had trusted him with their savings. This was a fraud on an epic, generational scale. In the history of federal prosecutions, there are few frauds that have caused as much harm as you have, Mr. Kwon, Engelmayer said during a hearing in Manhattan federal court. Kwon, 34, co-founded Singapore-based Terraform Labs and created the TerraUSD and Luna cryptocurrencies. He pleaded guilty and admitted misleading investors about a coin that was supposed to maintain a stable price during periods of market volatility. He is one of several cryptocurrency figures to face federal charges after the 2022 crash in digital asset prices led to the downfall of multiple firms. Wearing yellow prison clothing, Kwon apologised to his victims, including hundreds who had submitted letters describing the losses they suffered. All of their stories were harrowing and reminded me again of the great losses that Ive caused. I want to tell these victims that I am sorry, he told the court. Victims said the collapse destroyed savings, wiped out retirement funds, and harmed charities. One wrote that he had contemplated suicide after his father lost his retirement money in the scheme. Judge Engelmayer rejected both the governments recommendation of 12 years, calling it unreasonably lenient, and the defences request for five years, describing it as utterly unthinkable and wildly unreasonable. Kwon had faced a maximum of 25 years. Your offence caused real people to lose 40 billion dollars in real money, not some paper loss, the judge said, adding that Kwon had an almost mystical hold over investors and that the case amounted to a fraud on an epic, generational scale. Prosecutors said the losses from Terraform Labs collapse exceeded those from the frauds involving FTX founder Sam Bankman-Fried and OneCoin co-founder Karl Sebastian Greenwood combined. The judge estimated that up to a million people may have been affected. As part of his plea deal, Kwon agreed to forfeit more than 19 million dollars. His lawyers argued that his actions stemmed from hubris and desperation rather than greed. Judge Engelmayer rejected Kwons request to serve his sentence in South Korea, where he also faces prosecution and where his wife and young daughter live.The post Terra founder Do Kwon sentenced to 15 years in US for fraud appeared first on Linda Ikeji Blog.
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