Do Kwon 🧑⚖️, co-founder of Terraform 💻, the company responsible for the stablecoin TerraUSD 💰, has pleaded not guilty to fraud charges 🕵️♂️ brought against him by the United States 🇺🇸, which resulted in the stablecoin collapsing with losses estimated at $40 billion 💸.
Kwon, 33, appeared in Manhattan federal court on Thursday 🏛️, where he agreed through his attorney to remain in custody without bail 🚔. Kwon faces nine criminal charges ⚖️, including securities 📉 and commodities fraud.
The conflict of the two issues: between New York and South Korea 🇰🇷
Kwon's appearance in the New York court was the culmination of a two-year legal dispute ⚡ over where to try him, between the United States and South Korea. He was previously extradited by Montenegrin authorities 🇲🇪 this week after being arrested in March 2023 for using a fake passport 🛂.
Case details
US and South Korean authorities are accusing Kwon of collapsing the stablecoin TerraUSD 📊 of Singapore-based Terraform 🏙️, which rocked the crypto market 🌐 in the spring of 2022. That collapse in turn led to a series of disasters 💥, the most notable of which was the fall of the FTX exchange 🔻.
The accusations
According to US prosecutors, Kwon allegedly misled investors about the technology on which the TerraUSD chain was built, and the extent to which users relied on it, leading to massive losses.
Questions about the future
All eyes 👀 on the outcome of this case remain, especially with legal tensions surrounding the cryptocurrency space 📈 escalating after a series of major scandals and collapses 🚨.