Federal prosecutors have formally requested a 12-year prison sentence for Do Kwon, the founder of the collapsed Terra ecosystem. The move follows a plea agreement from August 2023, in which the Department of Justice reserved the right to pursue the maximum penalty. In their latest filing, authorities cited the recent sentencing of former FTX CEO Sam Bankman-Fried as a key precedent, arguing for a similarly severe punishment to uphold market integrity and deter future misconduct. The case centers on the catastrophic failure of TerraUSD (UST) and its sister token LUNA, which erased tens of billions in investor value during the 2022 market downturn. Kwon, currently detained in Montenegro pending extradition, faces multiple fraud charges in the United States. Legal experts suggest the prosecution’s reference to the Bankman-Fried case is a strategic effort to establish a judicial benchmark for holding blockchain project founders accountable for alleged financial crimes. The final sentencing decision rests with the presiding judge, who will weigh the arguments in the coming weeks.
