Do Kwon (alleged crypto criminal) pleaded no-guilt in New York on Thursday, to U.S. federal charges stemming from the 2022 collapse the Terra cryptocurrency ecosystem. This follows his extradition this week from Montenegro.
Feds charged the disgraced technology entrepreneur 33 with nine criminal charges, including wire fraud, commodities and securities fraud as well as conspiracy to engage in money laundering. He consented to being held in custody without bail by U.S. Magistrates Judge Robert Lehrburger on Thursday. Inner City Press reported.
Kwon is the founder of Terra, a former large crypto ecosystem that had apps based on the TerraUSD (UST), an algorithmic stablecoin. Investors liked the project, which grew quickly to be the second largest blockchain after Ethereum in early 2022.
Its native currency, LUNA was at its peak as one of top digital assets by capitalization. Kwon was able to make a large amount of money very quickly and even made fun of. "poor" Twitter is now called X.
But Terra collapsed in May 2022, taking $40 billion of investors' money with it. After the crash, many projects exposed to Terra’s project declared bankruptcy.
The project's main product, the UST stablecoin, couldn't keep its stable peg to the dollar, resulting in the entire ecosystem collapsing and losing nearly all of its value in a matter of days.
Both the U.S. authorities and the South Korean ones now claim that the scammer was the entrepreneur who duped investors into purchasing his cryptocurrency.
"Behind the scenes, core Terraform products did not work as Kwon advertised, and were manipulated to create the illusion of a functioning and decentralized financial system in order to lure investors," Thursday's indictment reads.
Kwon, a Korean citizen was detained in Montenegro for trying to use a false passport last year. He was kept in Montenegro by his lawyers until Tuesday when he finally got extradited.
Andrew Hayward edited the book
