Hearing for Kwon in American Courtroom
Do Kwon, co-founder of Terraform Labs, is currently embroiled in a significant legal battle regarding crypto fraud allegations, primarily from the U.S. Securities and Exchange Commission (SEC) and through bankruptcy proceedings involving Terraform Labs.
The legal wrangling began in spring 2023, with the SEC charging Do Kwon and Terraform Labs with multibillion-dollar crypto asset securities fraud. The charges involve unregistered sales of digital assets such as Terra USD (UST), LUNA, and MIR from April 2018 to May 2022, which the SEC alleges were offered and sold as unregistered securities, constituting securities fraud.
Terraform Labs filed for Chapter 11 bankruptcy in January 2024, with recognition of these proceedings granted in Singapore and the British Virgin Islands (BVI) during 2024 and 2025. A consent judgment was entered on June 12, 2024, including civil penalties totaling just under $4.5 million against Terraform Labs, to be allocated through the Chapter 11 plan in U.S. Bankruptcy Court.
In July 2025, the Singapore International Commercial Court imposed sanctions on creditors breaching the Chapter 11 recognition order in the ongoing restructuring. As of August 2025, no criminal sentencing has been publicized, and no imminent court dates have been announced.
Do Kwon appeared before a U.S. court on January 2, 2025, in relation to his extradition from Montenegro. The indictment against him, released by the Manhattan District Attorney's Office on the same day, includes nine counts, including conspiracy to commit fraud, money laundering, market manipulation, and securities fraud. As reported, Kwon has pleaded not guilty.
The next hearing in the case is scheduled for January 8, 2025. For updates on the case, you can follow Inner City Press on Twitter at https://twitter.com/innercitypress, who will be providing live updates and threads.
This ongoing legal saga is considered significant in shaping cryptocurrency regulatory enforcement trends, involving multi-jurisdictional elements due to Terraform’s corporate structure and international operations.
- The legal battle surrounding Do Kwon and Terraform Labs, embroiled in crypto fraud allegations, is a notable event in policy-and-legislation, particularly influencing cryptocurrency regulatory enforcement trends.
- The significant legal saga involving Do Kwon, with charges of securities fraud and related crimes, is an example of general-news and crime-and-justice intersecting in the complex world of politics.
