Crypto Community Divided Over Do Kwon $40B TerraUSD Plea
Do Kwon wey be co-founder for Terraform Labs don confess say e dey involved for conspiracy and wire fraud wen TerraUSD (UST) and e sister token LUNA collapse give $40 billion. E plea cover two out of nine original counts, wey reduce e maximum prison from 135 go 25 years. DOJ go recommend make dem sentence am for 12 years plus make dem allow international transfer after e serve half of im 12 years. Kwon admit sey e con investors by pretend say UST dollar peg dey valid and hide some trading firms wey dey involved. E gree say e go pay up to $19.3 million fine and dem go also seize im assets. Sentence date na December 11 for Manhattan. TerraUSD stablecoin lose im pegged dollar value for May 2022 after pesa dem comot well-well from Anchor Protocol. Dem try stabilize the market by mint more LUNA and spend $3 billion for Bitcoin reserves but e no work, cause TerraUSD and LUNA price near zero. Dem arrest Kwon for Montenegro 2023 and dem move am give US by late 2024. Crypto community split, some dey ask for max prison time while others say say na protocol failure no be criminal fraud. Till now, TerraUSD and LUNA price no show much change. Creditors dey wait for info on how investors go take recover money under the forfeiture agreement.
Neutral
Dis kain development don bring legal closure to wan of di biggest fraud dem for crypto, but e no likely say e go sharply move TerraUSD (UST) or LUNA prices short term. Di guilty plea and di recommended sentence don reduce regulatory wahala, wey fit good for di wider market sentiment. But since UST and LUNA tokens don already lose value sotay dem don comot from list, di direct trading impact dey small. For long run, di case dey show say stablecoin sector dey under strong watch and e fit block similar fraud scheme dem, but e no go bring back TerraUSD market value. Overall, di news neutral for UST and LUNA prices.