Do Kwon Set to Plead Guilty in $40 Billion Fraud Case After “Secret Bailout” Allegations Surface
Main Idea
Do Kwon, co-founder of Terraform Labs, will plead guilty to conspiracy and wire fraud charges related to the collapse of TerraUSD, which caused around $40 billion in losses.
Key Points
1. Do Kwon is set to plead guilty in a U.S. federal court for misleading investors about TerraUSD's stability, following a previous not-guilty plea in January.
2. Prosecutors allege Kwon falsely claimed an algorithm restored TerraUSD's peg in 2021 while secretly buying millions to artificially support its price.
3. Terraform Labs and Kwon settled a separate SEC civil suit in 2024, agreeing to a $4.55 billion penalty and a ban from the crypto industry.
4. Kwon was extradited from Montenegro after being arrested for using forged travel documents and has been in U.S. custody since late last year.
Description
Do Kwon will plead guilty to conspiracy and wire fraud in U.S. court over the TerraUSD collapse. Prosecutors allege he falsely claimed an algorithm restored TerraUSD’s value while secretly arranging market support. The SEC previously fined Kwon $80 million and banned him from cryptocurrency transactions in a $4.55 billion settlement. Do Kwon, the co-founder of the collapsed Terraform Labs, will plead guilty to conspiracy and wire fraud charges in a U.S. federal court. The plea follows allegation...
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