Do Kwon Pleads Not Guilty to US Fraud Charges

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I have written a few articles on man and case so I figured I'd provide an update. Do Kwon, the famous South Korean cryptocurrency entrepreneur behind two digital currencies that lost an estimated $40 billion in 2022, pleaded not guilty on Thursday to U.S. criminal fraud charges after being extradited from Montenegro this week. Kwon is one of several cryptocurrency moguls to face federal charges after a slump in digital token prices in 2022 prompted the collapse of a number of companies. Our friend, Sam Bankman-Fried who founded the exchange FTX is appealing his conviction and 25-year sentence for stealing $8 billion from customers. Then there is Alex Mashinsky, the founder and former CEO of cryptocurrency lender Celsius Network who just pleaded guilty last month to two counts of fraud.

In Thursday's indictment, the Manhattan U.S. Attorney's office alleged Kwon misled investors in 2021 about TerraUSD, a so-called stablecoin designed to maintain a value of $1. Kwon allegedly told investors a computer algorithm known as "Terra Protocol" had restored the coin's value when it slipped below its peg in May 2021, when in fact he arranged for a high-frequency trading firm to secretly buy millions of dollars of the token to artificially prop up its price. Prosecutors said that false claim and others drove retail and institutional investors to buy Terraform products and boost the value of Luna, a more traditional token developed by Kwon that fluctuated in value but was closely linked to TerraUSD, to $50 billion by the spring of 2022.

They unsealed a nine-count indictment charging Kwon, who co-founded Singapore-based Terraform Labs and developed the TerraUSD and Luna currencies, with securities fraud, wire fraud, commodities fraud and money laundering conspiracy. Kwon had agreed last June to pay an $80 million civil fine and be banned from crypto transactions as part of a $4.55 billion settlement that he and Terraform reached with the U.S. Securities and Exchange Commission. We will have to see how this all plays out in court!

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It's interesting timing because I just finished the second season of Squid Games and there is a charater that may be based off some of these real events. Im Si-wan as Lee Myung-gi or Player 333 was a YouTuber who went by the name of the “Amazing Myung-gi.” His terrible crypto investments hurt his checking account, but his worse advice is going to make his life a living hell in the games. I don't want to give too much away, but I thought it was pretty funny to think about the connection.