US Judge Paul Engelmayer handed Do Kwon a 15-year prison sentence for his role in the Terraform Labs collapse and related Terra Luna fraud.
The Do Kwon sentencing took place in the US District Court for the Southern District of New York after he pleaded guilty to wire fraud and conspiracy to defraud.
The court linked the Do Kwon sentencing to the Terraform Labs collapse in 2022, which erased around $40 billion from the crypto market.
Kwon will receive credit for time served in the United States and 17 months spent in pre-extradition custody in Montenegro.
Prosecutors had requested 12 years, while Kwon’s lawyers asked for five years.
Engelmayer said the 12-year request was “unreasonable” and called the five-year request “so implausible it would require appellate reversal.” The Do Kwon sentencing therefore landed between those two proposals.
Judge Explains Do Kwon Sentencing and Terra Luna Fraud Details
During the Do Kwon sentencing, Engelmayer described the Terra Luna fraud as “unusually serious.”
He said that for four years Kwon “publicly lied to the market”, which shaped how investors viewed Terraform Labs and its products.
The judge said investors in the Terraform Labs collapse accepted market risk but did not agree to the risk of fraud.
“The investors were taking a risk, caveat emptor. But they were not taking the risk of being a fraud victim,” he said. “What makes what you did so despicable is that you traded on trust.”
Engelmayer also sent a message beyond this single crypto fraud case. “To the next Do Kwon, if you commit fraud, you will lose your liberty for a long time as you will here,” he said, according to Inner City Press.
He added that Kwon had “been bitten by the crypto bug” and that he believed this had not changed, so Kwon “must be incapacitated.” Without the guilty plea, he said, the Do Kwon sentencing “would have been higher.”
Before hearing his sentence, Kwon addressed the court.
“I would like everyone to know that I have spent all my time thinking what I could have done, and what I can do,”
he said.
“It’s been four years since the crash, three years since I’ve seen my family. I’d like to [do] my penance in my home country.”
His remarks formed part of the record but did not change the length of the Do Kwon sentencing.
Terraform Collapse Victims Describe Losses at Do Kwon Sentencing
Prosecutors told the court that around 16,500 victims have filed claims tied to the Terraform Labs collapse in the ongoing bankruptcy case.
During the Do Kwon sentencing, six victims spoke to the court by phone and described their losses from the Terra Luna fraud.
One victim, Tatiana Dontsova, explained that she sold her apartment in Moscow to invest with Kwon.
“I sold my apartment in Moscow to invest with Do Kwon,”
she said, according to Inner City Press.
“I moved to Tbilisi. $81,000 turned into $13 in the palm of my hand.”
She also noted Kwon’s move to launch Luna 2, now referred to as LUNC, after the Terraform Labs collapse.
“He is not showing any responsibility for those who invested. I am now officially homeless,”
she told the court. Her statement placed a personal story next to the broader numbers in the crypto fraud case.
Other victims described similar outcomes, including lost savings and abandoned plans.
Their accounts gave Engelmayer detailed examples of how the Terraform Labs collapse and Terra Luna fraud affected individuals beyond market charts.
These testimonies helped frame the harm that underpinned the Do Kwon sentencing.
Do Kwon Sentencing Linked to South Korea Case and Extradition Path
The Do Kwon sentencing in New York does not close his legal exposure. Engelmayer said Kwon could be extradited to South Korea after serving seven and a half years of his US sentence.
If extradited, Kwon may serve the second half of his US sentence in South Korea.
At the same time, South Korean authorities are pursuing their own crypto fraud case related to the Terraform Labs collapse and Terra Luna fraud. Local charges could bring up to 40 additional years in prison.
Kwon’s route to the Do Kwon sentencing in New York included his arrest in Montenegro, where he and his legal team challenged extradition through several court steps.
He was handed over to US authorities in December 2024, which allowed prosecutors to move ahead with the plea and sentencing process.
Engelmayer also asked during the hearing what kind of justice Kwon might face in South Korea.
That discussion formed part of the decision on how to structure the Do Kwon sentencing, including the option for partial service of the term in his home country.
Do Kwon Sentencing Joins Other Crypto Fraud Case Prison Terms
The Do Kwon sentencing places him among several well-known figures in recent crypto fraud case histories. Former FTX CEO Sam Bankman-Fried received a 25-year sentence in the United States.
Former Binance CEO Changpeng Zhao received a four-month prison term. He later obtained a pardon from US President Donald Trump after completing that sentence.
Former Celsius CEO Alex Mashinsky was sentenced to 12 years in prison. His case, like the Do Kwon sentencing, followed investigations into failed crypto platforms and their impact on users.
Together, these rulings show how US courts have handled large crypto fraud case prosecutions.
The Do Kwon sentencing now sits beside the Terraform Labs collapse, the Terra Luna fraud findings, and victim testimony in the record of major enforcement actions in the sector.
Editor at Kriptoworld
Tatevik Avetisyan is an editor at Kriptoworld who covers emerging crypto trends, blockchain innovation, and altcoin developments. She is passionate about breaking down complex stories for a global audience and making digital finance more accessible.
📅 Published: December 12, 2025 • 🕓 Last updated: December 12, 2025
