Crypto entrepreneur Do Kwon faces 15 years' imprisonment over $40 billion collapse

Do Kwon, the cryptocurrency entrepreneur and the South Korean founder of the failed TerraUSD and Luna cryptocurrencies, has been sentenced to 15 years ' imprisonment for what U.S. District Judge Paul A. Engelmayer described as an “epic fraud” that resulted in an estimated loss of $40 billion.

During the sentencing in Manhattan federal court, Judge Engelmayer criticised Kwon for misleading investors who had invested their life savings in his cryptocurrencies.

Why is Do Kwon sentenced to 15-year jail term? 

Kwon, 34, co-founded Terraform Labs and previously pleaded guilty to charges of conspiracy to defraud and wire fraud. He also admitted to making false statements about a stablecoin designed to maintain a price of $1, which ultimately failed.

Kwon expressed regret in court, apologising to victims, including Ayyildiz Attila, who lost between $400,000 and $500,000. Attila described the detrimental effects of the collapse on his life, the BBC noted.

Prosecutors also outlined Kwon's intricate plans to inflate the value of his cryptocurrencies and argued for a prolonged jail term due to the significant harm caused by the collapse.

Kwon's defence requested a five-year sentence to allow him to return to South Korea, where he faces additional charges. It should be noted that he may seek a transfer abroad after serving half of his U.S. sentence.

In a separate civil case against him, Kwon agreed to pay an $80 million fine and be banned from crypto transactions as part of a settlement with the U.S. Securities and Exchange Commission.