Do Know, former CEO of Terraform accused of criminal fraud related to the 40 billion dollar collapse of TerraUSD, will be tried no earlier than January 2026. During this time, prosecutors should have the time to access the encrypted evidence, and defense lawyers, on the other hand, to examine the enormous amount of six terabytes of data during the investigations.
TerraUSD: the collapse of $40 billion and the trial of Do Know in the USA not before 2026
The criminal fraud trial related to the 40 billion dollar collapse of TerraUSD against Do Know, former CEO of Terraform Labs, could start not before 2026.
And so, on one hand, the prosecutors are asking for time to succeed in accessing the encrypted devices and to translate the communications from Korean to English.
On the other hand, the defense attorneys of Know will be able to examine the enormous amount of data of six terabytes that will be produced during the investigations.
The one to affirm this new start date was District Judge Paul Engelmayer of the Southern District of New York (SDNY), in yesterday’s hearing.
Engelmayer stated that scheduling the start date of a trial more than a year after the initial conference is “unprecedented” in his career as a judge.
In fact, to mediate this issue, Engelmayer himself gave a week of time to Know’s lead attorney, Michael Ferrara of the firm Hecker Fink LLP, to be able to request an earlier date in 2025.
TerraUSD and the 40 billion dollar collapse: the case against Do Know
Do Know is accused of as many as nine charges for securities fraud, wire fraud, commodities fraud, and conspiracy to commit money laundering.
All these accusations are linked to the 40 billion dollar implosion of the Terra/LUNA ecosystem in 2022.
Last week, however, Do Kwon pleaded not guilty to one of the nine charges.
The former CEO of Terraform spent 22 months in a Montenegro prison, managing to have the extradition decision to the USA revoked three times.
In any case, it is now in the hands of the United States awaiting its judgment. The Securities and Exchange Commission (or SEC) of the USA has already won its civil case against Know last March 2024.
In fact, according to the jury, Do Know and Terraform Labs are guilty of being responsible for fraud and of deceiving investors about the stability of its native algorithmic stablecoin TerraUSD (UST) and the use cases of the Terra blockchain.
As of today, Know and Terraform have been sentenced to pay 4.5 billion dollars in fines and relief, while Kwon himself has contributed 200 million dollars.
Another lawsuit against Terraform Labs
Last summer, Terraform Labs was sued by the liquidators of the crypto hedge fund Three Arrow Capital (3AC) who are seeking 1.3 billion dollars in compensation.
The accusation speaks of manipulation of the LUNA and TerraUSD token market and that Terraform allegedly induced 3AC to purchase them, managing to “artificially inflate the price of the assets before they were wiped out.”
In 2022, then, 3AC had also filed for bankruptcy, declaring that the collapse of the Terra network had caused it irrecoverable losses.
Source: https://en.cryptonomist.ch/2025/01/09/terrausd-do-know-will-be-tried-in-the-usa-in-2026-for-charges-of-criminal-fraud/