#TrumpTariffs This is Do Kwon, the biggest scammer in the cryptocurrency world.
This is Do Kwon, the biggest scammer in the cryptocurrency world.
Everyone was deceived by the LUNA currency and disappeared with $40 billion
Yesterday he was sentenced to 15 years in prison
Here are his secrets and crimes and how to recover your money 🧵👇
For the first time here, get to know Do Kwon.
He was previously known as a genius and the future of finance
Created #Terra and #UST - one of the biggest stories in the world of cryptocurrencies.
Then it became a key symbol of systemic fraud.
And now he faces a prison sentence of 15 years
Let's start from the beginning
Do Kwon was born in Seoul, South Korea.
He was smart, ambitious, and quick-tempered since childhood.
In high school, he launched his own media outlet that spread to 60 schools.
By the time of graduation, the project was already generating annual revenues of about $500,000 from ads in the education sector.
He later studied at Stanford University and gained a strong technical foundation at the university
After university, he worked at leading tech companies - @Apple and @Microsoft.
But he soon became disappointed with slow companies.
He was not interested in a stable career - no.
He was interested in scale, impact, and control - yes.
Cryptocurrency became the ideal environment for those ambitions.
The idea of decentralized money excited Do Kwon.
Especially #stablecoins as the foundation of a new economy.
And thus the famous concept of #Terra was formed.
Launched the project with Daniel Shin in 2019.
The idea seemed revolutionary even for cryptocurrencies.
Algorithmic stablecoin $UST without real reserves.
Isn't this every investor's dream?
In fact, UST was not a stablecoin as everyone thought
UST operated through its peg to #LUNA, the project's currency
If the price of UST falls below $1 -> #LUNA is burned
If the price of UST rises above $1 -> $LUNA is minted
As long as the market trusted the system and didn't doubt it, the system seemed stable
And everything seemed fine
At the beginning of 2022, Terra had already become a giant.
The market capitalization of UST and LUNA exceeded $50 billion.
But it was a fragile structure.
Do Kwon had to find a way to attract more people, money, and trust.
To enhance this trust, Do Kwon promoted the Anchor protocol
Which promised an annual return of about 20% on UST deposits.
And it worked.
Within a few weeks, 70-75% of the total UST there was frozen.
It was clear that the treasury became richer and everyone was happy until this happened.
On May 7, 2022, Do Kwon's team withdrew $150 million from Curve.
This decision was made within Terraform Labs.
And almost immediately, another large wallet sold about $85 million.
For an algorithmic stablecoin, such a change breaks trust.
This was the beginning of the end.
Once users saw the error, they started exiting Anchor en masse.
At that time, the price of UST fell to $0.99, then $0.97, then $0.95
The algorithm started printing LUNA in unlimited quantities.
But that didn't help at all.
On May 9, the price of UST was $0.35
The supply of LUNA rose from 345 million to trillions within days.
The price fell by over 99%.
Exchanges halted trading and the blockchain was technically shut down.
Terra ceased to exist as a system.
And Do Kwon walked away with $40 billion.
You may wonder how? How did he manage to withdraw $40 billion?
Investigations revealed that the funds were withdrawn months before the collapse.
Some UST and LUNA were sold through related entities while liquidity was still available.
When the system collapsed, the money was no longer in the protocol - it was with Do Kwon.
In 2023, charges were filed against Do Kwon in the US and Korea.
He was then arrested in Montenegro with forged documents.
He continued to delay delivery actions for two years, but that didn't save him.
But in 2025, the court recently issued its final ruling
Do Kwon was sentenced to up to 15 years in prison for financial fraud
It was officially recognized that the collapse of Terra was due to deliberate actions
And 'startup failure' was reclassified as a crime
As they say, no gain without pain
