U.S. prosecutors are overseeing the criminal case against Do Kwon, the co-founder of Terraform Labs, estimating that more than a million individuals may have been affected by the collapse of the ecosystem.

U.S. Attorney Daniel Gitner stated that the government will establish a website to help inform victims of their rights, while calling other notification methods "impractical."

The U.S. government prefers to use a website to communicate with the victims of the Terra case.

The U.S. government estimates that the number of victims affected by the collapse of the Terra ecosystem is over 1 million.

U.S. Attorney Daniel Gitner filed a motion in the U.S. District Court for the Southern District of New York on January 6, describing the notification procedures for potential victims regarding Do Kwon's public litigation.

The U.S. Attorney stated that the government will set up a website to inform victims of their rights, labeling traditional notification methods as "impractical" due to the decentralized nature of cryptocurrency transactions, which often lack personally identifiable information.

Terra collapsed in May 2022 and Do Kwon was charged with nine counts of fraud.

In May 2022, Terra, once the third-largest cryptocurrency after Bitcoin and Ether, collapsed, losing a valuation of $50 billion in just 72 hours. When founder Do Kwon launched Terra, he claimed that he wanted to build a better ecosystem than Bitcoin and Ethereum. He added that he needed a stablecoin to compete directly with fiat currencies. Unfortunately, the entire project lacked transparency.

According to the U.S. Department of Justice, Kwon deceived investors by making false statements about the company's blockchain products and manipulating their market to create the illusion of a functioning and decentralized financial system.

Earlier this year, Kwon was extradited from Montenegro to the U.S., where he now faces nine counts of fraud. On January 2, he appeared in front of a U.S. judge for the first time and did not plead guilty.

However, the authorities have yet to clarify whether they will pursue a plea deal with the Terraform co-founder or proceed with a full criminal trial. Due to involvement in fraudulent activities, Kwon had to pay a $4.5 billion settlement to the U.S. Securities and Exchange Commission in April 2024.

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