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A former crypto entrepreneur who was behind two digital currencies that collapsed and lost an estimated $40bn ($29.9bn) has been sentenced by a New York judge to 15 years in prison for an “epic” fraud.<\/p>\n
Do Kwon, a South Korean national, was co-founder of Singapore-based Terraform Labs, which developed the TerraUSD and Luna digital coins.<\/p>\n
Kwon had admitted misleading investors about TerraUSD, a so-called stablecoin that was supposed to maintain its value against the US dollar.<\/p>\n
He was one of a number of crypto bosses to face charges in the US after digital tokens slumped in 2022, triggering the failure of several companies.<\/p>\n<\/div>\n
US District Judge Paul A Engelmayer, who handed down the sentence, said the Stanford graduate had repeatedly lied to investors who trusted him with their money.<\/p>\n
“This was a fraud on an epic, generational scale,” he said during Thursday’s court hearing in Manhattan. <\/p>\n
“In the history of federal prosecutions, there are few frauds that have caused as much harm as you have.”<\/p>\n
Kwon – who pleaded guilty in August to conspiracy to defraud and wire fraud – expressed remorse to the judge.<\/p>\n
“I have spent almost every waking moment of the last few years thinking of what I could have done different and what I can do now to make things right,” he said.<\/p>\n
Prosecutors alleged that when TerraUSD fell below its $1 peg in May 2021, Kwon told investors that a computer algorithm had restored its value.<\/p>\n
Instead, Kwon had arranged for a trading firm to secretly buy millions of dollars of the coin to artificially boost its value, according to court documents.<\/p>\n<\/div>\n