Terraform’s Do Kwon Pleads Guilty in $40B TerraUSD Fraud Case

Terraform Labs co-founder Do Kwon pleaded guilty on Tuesday in Manhattan federal court to one count each of conspiracy to defraud and wire fraud stemming from the 2022 collapse of the algorithmic stablecoin TerraUSD and its companion token Luna, an event that erased about $40 billion in value from cryptocurrency markets.

Under the plea agreement presented to U.S. District Judge Paul Engelmayer, prosecutors will advocate for a prison term of no more than 12 years—well below the roughly 25-year guideline range—and a $19 million fine, provided Kwon commits no further offenses before sentencing. The judge accepted the plea and will set a sentencing date later.

Kwon, 33, had previously denied a nine-count indictment that also alleged securities, commodities and money-laundering violations. He was extradited from Montenegro on Dec. 31, 2024, after months at large. The criminal case follows a separate $4.55 billion civil settlement with the U.S. Securities and Exchange Commission reached last year, which banned him from future crypto activities.

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