In the crypto ecosystem, some cases keep coming back like boomerangs. The case of Do Kwon, founder of Terraform Labs, is one of those matters that leave a lasting mark. As his court appearance approaches, US prosecutors are demanding a harsh sentence: twelve years in prison. A request that, beyond symbolism, recalls the shockwave caused by the collapse of the Terra ecosystem.
In Brief
- •US prosecutors request twelve years in prison for Do Kwon after Terra’s collapse.
- •They believe his actions triggered a major crisis in the crypto ecosystem.
- •Kwon faces legal risks in the United States as well as in South Korea.
A Harsh Sentencing Recommendation
US prosecutors did not hold back. In a case submitted to the federal court in New York, they demand twelve years in prison and confiscation of profits deemed criminal. In their view, the damage caused by Do Kwon surpasses that of notoriously infamous figures such as Sam Bankman-Fried, Alex Mashinsky, or Karl Sebastian Greenwood, while he acknowledges the facts and requests a reduced sentence. A heavy, almost provocative comparison, illustrating the scale of the fiasco.
This severity does not come out of nowhere. Since his guilty plea on two charges, wire fraud and conspiracy, the judicial framework has tightened. Prosecutors emphasize that the collapse of Terra in 2022 triggered a chain reaction. A real tidal wave that helped establish the notorious “Crypto Winter,” a freezing period for the entire sector.
This dynamic, still palpable today, has left a deep scar. The prosecution’s argument precisely rests on this idea: Kwon did not just deceive investors, he weakened an entire crypto market already shaken by a succession of scandals.
A Complex Judicial Path Ahead
This dynamic, still palpable today, has left a deep scar. The prosecution’s argument precisely rests on this idea: Kwon did not just deceive investors, he weakened the entire crypto and Terraform market already shaken by a succession of scandals.
Because another threat looms: the South Korean justice system. Prosecutors in his country would demand a sentence that could rise up to forty years. A prospect his legal team brandishes before the American judge to obtain a milder sanction.
In clear terms: no matter what happens in the United States, Kwon will probably not regain his freedom anytime soon. Even if each party proposes its own recommendation, the final arbiter remains the judge. And the range of possibilities remains wide: from a few years to several decades.