Crypto boss sentenced to 15 years over ‘generational scale’ fraud that lost over $40 billion

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I can’t believe it – Do Kwon, the guy behind TerraUSD and Luna, could be in prison for fifteen years! The judge is calling what he did a ‘generational’ scam, and honestly, it feels like it. So many people lost money, and it’s good to see some accountability finally happening.

In May 2022, the cryptocurrency LUNA suddenly lost almost all of its value. It dropped from a price of $87 per token to less than a penny – specifically, $0.00005.

The creator of the cryptocurrency has been sentenced to fifteen years in prison after a judge described his crime as a massive, multi-generational fraud. This sentencing comes over three years after the fraudulent activity began.

Do Kwon, a South Korean entrepreneur and software developer, co-founded and led TerraformLabs, the company behind the cryptocurrencies LUNA and TerraUSD.

LUNA was once considered a leading cryptocurrency, but its dramatic collapse caused significant financial damage. Now, years later, Do Kwon, the creator of LUNA, is facing the consequences.

Do Kwon faces 15 years in prison over LUNA fraud

Following the collapse of LUNA, Kwon left South Korea and was arrested in Montenegro in March 2023 while attempting to travel to Dubai with a fake passport. He was then brought to the United States and indicted by a grand jury on eight counts of fraud.

He admitted guilt on two charges, expressed remorse to those he defrauded, and stated he had made a mistake. In December 2025, he received a 15-year prison sentence.

I was in court today and Judge Engelmayer really didn’t hold back when describing what Kwon did. He called it a massive fraud, something that will impact people for years to come – he even said it was ‘on an epic, generational scale.’ It was pretty shocking to hear him put it that way.

The judge told Do Kwon, “Your fraud is among the most damaging cases federal prosecutors have ever seen.”

Before its dramatic collapse in 2022, LUNA was once worth an estimated $50 billion. The crash reportedly wiped out around $45 billion in value.

Kwon isn’t the only South Korean facing crypto fraud charges lately. In August, another person was arrested – initially for littering – but was then found to be linked to a cryptocurrency scam that allegedly took 17.7 billion won from 1,300 people. He now faces ten criminal charges.

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2025-12-12 22:19