This is Do Kwon, the biggest fraudster in the world of cryptocurrencies.
He deceived everyone with LUNA and disappeared with 40 billion dollars.
Yesterday he was sentenced to 15 years in prison.
Here are his secrets and crimes and how to recover your money 🧵👇
From here for the first time, get to know Do Kwon.
He was previously known as a genius and the future of finance.
He created #Terra and #UST - one of the biggest stories in the world of cryptocurrencies.
Then it became a major 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 to anger since childhood.
In high school, he launched his own media outlet that spread to 60 schools.
By graduation, the project was already generating annual revenues of around $500,000 from ads in the education sector.
He later studied at Stanford University and obtained a strong technical foundation from the university.
After college, he worked at leading tech companies - @Apple and @Microsoft.
But he quickly became disappointed with the slow companies.
He was not interested in a stable career - no.
He was interested in size, impact, and control - yes.
Cryptocurrency became the perfect 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.
The project was launched 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 link to #LUNA, the project's coin.
If the price of UST drops 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 did not 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.
And Do Kwon had to find a way to attract more people, money, and trust.
To build this trust, Do Kwon promoted the Anchor protocol.
Which promised an annual return of around 20% on UST deposits.
And it worked.
In a matter of weeks, 70-75% of the total UST was frozen there.
It was clear that the treasury became richer, and everyone was happy until this happened.
On May 7, 2022, the Do Kwon team withdrew $150 million from Curve.
This decision was made within Terraform Labs.
And almost immediately, another large portfolio 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 began to exit Anchor en masse.
At that time, the price of UST dropped to $0.99, then $0.97, then $0.95.
The algorithm started printing LUNA in unlimited quantities.
But that did not help at all.
On May 9, the price of UST was $0.35.
The supply of LUNA rose from 345 million to trillions in a matter of days.
The price dropped by more than 99%.
Exchanges halted trading, and the blockchain was technically shut down.
Terra ceased to exist as a system.
And Do Kwon exited with $40 billion.
You might wonder how? How did he 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 present.
When the system collapsed, the money was no longer in the protocol - it was with Do Kwon.
In 2023, charges were brought against Do Kwon in the United States and Korea.
He was then arrested in Montenegro with forged documents.
He continued to delay delivery procedures for two years, but that did not 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 the result of deliberate actions.
And the 'startup failure' was reclassified as a crime.
And as they say, there's no gain without pain.
