Do Kwon Pleads Guilty to Fraud in Terra USD Collapse, Sentence Reduced to 25 Years

Terraform Labs co-founder Do Kwon, the architect behind the failed Terra USD stablecoin, has pleaded guilty to wire fraud and conspiracy to defraud in a New York federal court. The admission marks a dramatic fall from grace for the once-celebrated crypto mogul, whose algorithmic stablecoin project collapsed in 2022, wiping out over $40 billion in market value and triggering a cascading crisis across the digital asset industry.

The guilty plea reduces Kwon's potential prison sentence from 150 years to 25 years, according to court documents. U.S. District Judge Paul Engelmayer confirmed the plea change this week, ending months of speculation about whether the disgraced founder WOULD contest the charges. The Terra USD debacle remains one of crypto's most spectacular failures, exposing the fragility of algorithmic stablecoins and contributing to heightened regulatory scrutiny worldwide.