Terra founder Do Kwon was sentenced to 15 years in prison for fraud.

A US court has sentenced Terra founder Do Kwon to 15 years in prison, closing one of the biggest scams in crypto market history.

This sentence was handed down on December 11, 2025, after Do Kwon pleaded guilty a few months earlier this year.

Is the crypto winter of 2022 over?

This ruling concludes a 3-year and 7-month legal battle that began after the collapse of the Terra Algorithmic Stablecoin ecosystem in May 2022, wiping out tens of billions of dollars in market Capital and triggering a chain of collapses in many other crypto projects.

The prosecution alleges that Do Kwon intentionally provided false information to retail investors about the stability of TerraUSD and the "backing" of the entire ecosystem he built.

Do Kwon's sentence is significantly lighter than the 25-year prison sentence received by Sam Bankman-Fried, the founder of FTX , but both cases have changed the approach of regulators globally to the digital asset sector.

The prosecution emphasized the severe damage caused by the Terra collapse, with numerous small investors losing everything and a ripple effect across multiple lending platforms and hedge funds.

Prior to his extradition, Do Kwon had faced charges in both the United States and South Korea. His guilty plea consolidated the legal proceedings under U.S. jurisdiction and led to today's sentence.

The court emphasized investor protection and accountability as core elements when deciding on the length of the prison sentence.

This ruling marks a turning point for the Terra community, where many still hold and trade the old LUNC and LUNA Token despite the core network's collapse. The market is reacting with considerable uncertainty as traders try to assess the consequences of Do Kwon's verdict.

Now that the case is closed, many experts believe that regulators will XEM this a "model case" to apply to future cases involving Algorithmic Stablecoin or other complex, high-risk financial products in the crypto sector.