Three years after the collapse of LUNA and UST, Terra founder Do Kwon is still in the midst of a legal battle, and after today's news that the U.S. Department of Justice (DOJ) is seeking a 12-year prison sentence, Luna Classic (LUNC) is up 130%.
Luna Classic is the original Terra network token at the center of its algorithmic stablecoin model that spectacularly collapsed in 2022. The downfall of Terra’s UST stablecoin is considered a primary contributor to the FTX collapse and 2022-2023 bear market. Following the collapse, the Terra 2.0 hardfork was launched with a new token under the LUNA ticker.
It was reported today that Trump’s Department of Justice, which has been known for its leniency with crypto founders and companies, is seeking a maximum sentence of 12 years in prison for Terra’s founder, Do Kwon.
Kwon pleaded guilty in August in a deal that included jail time of “no more than 12 years.” However, prosecutors are sticking to their guns and requesting the maximum sentence for the founder.
With Kwon facing 12 years in prison, LUNC, which almost trades like a large cap memecoin at this point, is up 130% today, likely fueled by momentum traders and short squeezes, although there is no public data accounting for liquidations at this time.
Momentum is also carrying over to Terra 2.0’s LUNA token, which is up 70% today.
