Do Kwon, the South Korean entrepreneur behind two cryptocurrencies who lost about 40 billion dollars in 2022 and had the market implode, pleaded guilty on two American accusations of fraud and fraud by wire on Tuesday.
Kwon, 33, who co -founded Terraform Labs, based in Singapore and developed the Corison Terrausd and Luna, pleaded during a hearing by the Federal Court in New York. He had pleaded not guilty in January to an indictment of nine counts accusing him of fraud in securities, wire fraud, fraud on raw materials and conspiracy in terms of money laundering.
Accused of having deceived investors in 2021 about Terrausd – a so -called stablecoin designed to maintain a value of $ 1 – Kwon pleaded guilty to the two counts under an agreement with the Manhattan American prosecutor’s office, which brought the accusations.
He risks up to 25 years in prison when Engelmayer sentenced him on December 11, although prosecutor Kimberly Ravener said that the government had agreed to defend a prison sentence of no more than 12 years, provided that he accepts the responsibility of his crimes. He has been detained since his extradition from Montenegro at the end of last year.
Kwon is one of the many cryptocurrency magnates to face federal accusations after collapse in the prices of digital tokens in 2022 caused the collapse of a certain number of companies. Sam Bankman Fried, founder of the largest crypto exchange in the United States, FTX, was sentenced to 25 years in prison in 2024.
The prosecutors allegedly allegedly allegedly gave up under his ankle of $ 1 in May 2021, Kwon told investors that a computer algorithm called “terra protocol” had restored the value of the room. Instead, they said, he organized a high frequency negotiation company to secretly buy millions of dollars in token to artificially support its price.
The prosecutors said that the false complaint and others led retail and institutional sales investors to buy terraform products and increase the value of Luna – a more traditional token that has fluctuated in value but was closely linked to Terrausd – $ 50 billion by spring of 2022.
In court, Kwon apologized for his conduct.
“I made false and misleading statements on the reasons why he found his ankle by not revealing the role of a commercial enterprise in the restoration of this PEG,” said Kwon. “What I did was bad.”
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Kwon agreed in 2024 to pay $ 80 million as a civil fine and to be prohibited from cryptographic transactions within the framework of a payment of $ 4.55 billion that he and Terraform have reached with Securities and Exchange American Commission.
He also faces accusations in South Korea. As part of the agreement, prosecutors will not oppose Kwon’s potential demand to transfer abroad after serving half of his American sentence, said Ravener.
