Terraform Labs co-founder Kwon Do-hyung has been sentenced to 15 years in prison by a US court. He was sentenced for his role in the Luna and Terra crash in 2022, which resulted in losses of approximately $40 billion (approximately 58.9 trillion won) in the global cryptocurrency market.
The U.S. District Court for the Southern District of New York sentenced Kwon Do-hyung to 15 years in prison on the 11th (local time) after he pleaded guilty to fraud and conspiracy charges. Judge Paul Engelmayer said that the sentence would also deduct Kwon's time in U.S. custody and the 17 months he served before being extradited.
Before sentencing, the court questioned the Terra victims' statements and what punishment Kwon Do-hyung might face upon his return to Korea. A separate criminal trial is also planned for Kwon Do-hyung in Korea.
In his final statement, Kwon Do-hyung said, "I've spent a long time thinking about what I did wrong and what I could have done better. It's been four years since the accident, and three years since I last saw my family. I want to pay the price in Korea."
The Terra incident vividly demonstrated the consequences of human greed and systemic trust. It triggered a catastrophic collapse of trust in the global cryptocurrency market and subsequently led to stronger surveillance policies for stablecoins and DeFi.
๐ Market Interpretation
The Terra incident fundamentally shook the credibility of the stablecoin structure. Kwon Do-hyung's prison sentence is expected to once again highlight the need for stronger regulations on related projects and increased investor caution.
๐ก Strategy Points
It's time to assess the risks of algorithm-based stablecoin projects and high-yield NFTs and DeFi projects. Investors should carefully examine the coin's structure, team history, and transparent disclosure of information.
๐ Glossary
Terraform Labs: A Singapore-based blockchain company that developed the algorithm-based stablecoin TerraUSD (UST) and its sister token Luna.
Stablecoins: Cryptocurrencies designed to have low price volatility. They are typically pegged to real assets like the US dollar or maintained through algorithms.
DeFi: Decentralized finance. A system that implements various financial services based on blockchain without intermediaries like banks.
TP AI Precautions
This article was summarized using a TokenPost.ai-based language model. Key points in the text may be omitted or inaccurate.
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