South Korean cryptocurrency entrepreneur Kwon Do-hyung was sentenced to 15 years in prison by a U.S. judge on Thursday. The collapse of the two stablecoins he founded, TerraUSD and Luna, in 2022 caused losses of approximately US$40 billion to global investors, which the judge called "epic fraud." Quan Daoheng, 34, who co-founded Singapore-based Terraform Labs and developed TerraUSD and Luna currencies, previously pleaded guilty and admitted misleading investors.
Kwon Do-hyung is one of several cryptocurrency tycoons facing charges from the U.S. government after the two digital tokens plummeted in price in 2022, leading to the collapse of several companies.
Manhattan U.S. District Judge Paul Engelmayer, who handed down the sentence, harshly accused Quan of repeatedly lying to ordinary investors who had entrusted him with their life savings.
"This was a scam of epic, generational proportions. In the history of federal prosecutions, few frauds have caused as much harm as yours, Mr. Kwon," Engelmeyer said during the court hearing.
U.S. prosecutors had previously requested that Quan Daoheng be sentenced to at least 12 years in prison, saying that the collapse of his stablecoin caused huge losses and triggered a series of crises in the crypto market.
Kwon Do-hyung's lawyers had asked for a prison term of no more than five years so he could return to South Korea to face criminal charges.
In January this year, U.S. prosecutors charged Quan Daoheng with nine criminal charges, including securities fraud, wire fraud, commodity fraud and conspiracy to commit money laundering.