Do Kwon, crypto entrepreneur who caused 2022 market crash, pleads guilty to fraud
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Do Kwon pleaded guilty to one count of conspiracy to commit commodities fraud, securities fraud and wire fraud, and one count of committing wire fraud.
PHOTO: REUTERS
Natallie Rocha
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- Do Kwon pleaded guilty to two fraud counts: conspiracy to commit commodities, securities and wire fraud, and committing wire fraud.
- Kwon agreed to forfeit over US$19 million and could face up to 25 years in prison, but the government will seek no more than 12 years.
- Kwon admitted to misleading statements about luna and terraUSD, cryptocurrencies that crashed in 2022 after raising over U$200 million.
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SAN FRANCISCO – Do Kwon, a cryptocurrency entrepreneur who designed a pair of digital currencies that failed spectacularly in 2022, triggering a market meltdown, pleaded guilty on Aug 12 to two counts of fraud.
At a hearing in federal court in New York,
Judge Paul A. Engelmayer agreed to the defendant’s plea, according to a spokesperson for the US attorney’s office in Manhattan.
Kwon agreed to forfeit more than US$19 million (S$24.4 million) in proceeds from his crypto dealings, Mr Nicholas Biase said.
If the judge decides to enforce the maximum penalty, Kwon could face 25 years in prison. But as part of the plea agreement, Mr Biase said, the government would not ask the judge for a sentence of more than 12 years.
Kwon, 33, who is a citizen of South Korea, also agreed to serve the first half of his sentence in the US before seeking a transfer to South Korea. Mr Sean Hecker, Kwon’s lawyer, said his client accepted responsibility “for making false and misleading statements” to people who bought his cryptocurrencies.
The pleas cap a spectacular fall from grace for Kwon,
The company raised more than US$200 million from investment firms such as Lightspeed Venture Partners.
At one point, Luna’s total value ballooned to more than US$40 billion. NYTIMES
