A U.S. court sentenced Terra founder Do Kwon to 15 years in prison, concluding one of the most significant fraud cases in the history of cryptocurrency.
The decision, made on December 11, 2025, followed Kwon's admission of guilt earlier this year.
Crypto winter of 2022: the end of the saga
The verdict marks the conclusion of a legal saga lasting three years and seven months, which began after the collapse of the algorithmic stablecoin Terra ecosystem in May 2022. This event led to the loss of tens of billions of dollars in market value and triggered a cascade of bankruptcies in the crypto sector.
The prosecution argued that Kwon deliberately misled investors about the stability of TerraUSD and the backing of its broader ecosystem.
Kwon's sentence turned out to be lighter than the 25-year sentence imposed on FTX founder Sam Bankman-Fried, although both cases fundamentally changed the approaches of global regulators to digital assets.
Prosecutors emphasized the scale of the damage caused by the collapse of Terra, pointing to massive losses for retail investors and systemic consequences for lending platforms and hedge funds.
Before Kwon's extradition, charges were brought in both the United States and South Korea. His guilty plea allowed for the consolidation of legal proceedings under U.S. jurisdiction, which made today's sentencing possible.
The court emphasized that investor protection and accountability became central factors in determining the length of the sentence.
This decision marks a turning point for the Terra community, which, despite the network's collapse, continues to trade inherited tokens LUNC and LUNA. Market reactions remain volatile as traders analyze the implications of Kwon's guilty verdict.
Now that the case is closed, regulators are expected to use this verdict as a precedent for future enforcement actions concerning algorithmic stablecoins and high-risk financial engineering in the cryptocurrency space.
