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Do Kwon Seeks Five-Year Sentence for Terra Collapse Role

Thursday Nov 27 2025 11:00

2 min

Table of Contents

1. Do Kwon Seeks Limited US Sentence
1.1 Kwon's Legal Troubles Continue in South Korea
1.2 Sam Bankman-Fried's Case

Do Kwon Seeks Limited US Sentence

Do Kwon, the co-founder of Terraform Labs, has requested a US judge to cap his prison sentence at five years for his role in the collapse of the Terra ecosystem, an event that erased roughly $40 billion from cryptocurrency markets in 2022. According to Bloomberg, in a court filing on Wednesday, Kwon’s legal team argued that a longer term would be excessive, considering the time he has already served and the penalties he has agreed to accept. Kwon pleaded guilty in August to two counts of wire fraud and conspiracy to defraud following his extradition from Montenegro, where he had been detained. His lawyers stated that he has spent nearly three years behind bars, “with more than half that time in brutal conditions in Montenegro,” and that he has already paid a significant personal and financial price. Under the plea agreement, US prosecutors have agreed not to seek a sentence exceeding 12 years. However, the defense has urged the court to further reduce the sentence, arguing that anything beyond five years would be “far greater than necessary” to achieve justice. Kwon has also agreed to forfeit over $19 million along with several properties as part of the deal.

Kwon's Legal Troubles Continue in South Korea

Even after the US sentencing, Kwon’s legal challenges will persist. Prosecutors in South Korea are pursuing a separate case related to the same events and are seeking a prison sentence of up to 40 years there. Kwon is scheduled to be sentenced by US District Judge Paul Engelmayer in Manhattan on December 11. Prosecutors are expected to submit their own recommendations in the coming days. Following the Terra crash in 2022, Kwon’s whereabouts remained largely unknown until Montenegrin authorities apprehended him for using falsified travel documents. He served four months in prison there before both US and South Korean officials requested his extradition from Montenegro, a process complicated by legal challenges in the country’s lower courts.

Sam Bankman-Fried's Case

Kwon is not the only figure in the crypto space facing significant legal repercussions. In 2024, former FTX CEO Sam Bankman-Fried was sentenced to 25 years in prison by a federal judge. Earlier this month, Bankman-Fried's legal team challenged his conviction and sentence in a US appeals court, arguing that he was denied a fair trial. They contend that the jury never considered evidence indicating FTX remained solvent and that the prevailing narrative of misappropriated customer funds prejudiced the case before Bankman-Fried could adequately defend himself.

Risk Warning: this article represents only the author’s views and is for reference only. It does not constitute investment advice or financial guidance, nor does it represent the stance of the Markets.com platform.When considering shares, indices, forex (foreign exchange) and commodities for trading and price predictions, remember that trading CFDs involves a significant degree of risk and could result in capital loss.Past performance is not indicative of any future results. This information is provided for informative purposes only and should not be construed to be investment advice. Trading cryptocurrency CFDs and spread bets is restricted for all UK retail clients. 

Written by:

Liam James

Do Kwon Seeks Five-Year Sentence for Terra Collapse Role

Do Kwon Seeks Limited US Sentence

Kwon's Legal Troubles Continue in South Korea

Sam Bankman-Fried's Case

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