Are 15 years not enough? Do Kwon's legal nightmare is just beginning in South Korea

Do Kwon faces charges in South Korea after his conviction in the US. Thousands of victims demand justice for the collapse of his cryptocurrency project.

The recent ruling in a New York court seemed to bring to a close one of the darkest chapters in the recent history of digital finance. However, the situation of Do Kwon, founder of Terra, is far more complicated and difficult than it appears. 

The United States has already sentenced him to 15 years in prison for his responsibility in the collapse of Terra.However, the disgraced founder now faces justice in South Korea, which is moving towards a key legal process for his future.

In Seoul, thousands of victims are demanding justice with unwavering voices, while local prosecutors are preparing charges under national legislation that could extend Kwon's sentence for several more decades. This figure, who once led one of the most ambitious projects in the blockchain ecosystem, faces charges detailing how his algorithmic stablecoin failed catastrophically in 2022, wiping out some $40.000 billion in market value.

Do Kwon and the collapse of Terra/Luna: the truth behind the crash

Do Kwon went from being one of the most revered and charismatic figures in the development of blockchain technology to becoming the face of financial irresponsibility. His rapid rise was based on the vision of an innovative system powered by Terraform Labs, the Singapore-based company he helped found. It all revolved around LandUSD, a stablecoin designed to always be worth one dollar, and its partner LUNAThey used a clever algorithm instead of stacks of real money to maintain balance. Large investors and ordinary people alike were excited by the idea, seeing him as a genius in the crypto world.

But that excitement turned to disappointment when the ecosystem Kwon founded collapsed and the truth came out. In its downfall, Terra wiped out nearly $40.000 billion from its users and investors. US prosecutors discovered that Terraform Labs paid a firm to secretly buy TerraUSD and artificially inflate its price. Thus, when everything collapsed in May 2022, billions of dollars vanished. Everyday families and investors were left empty-handed, while several companies in the sector went bankrupt one after another.

This collapse marked a turning point in trust in digital assets, highlighting the fragility of projects that lack operational transparency.

The burden of the victims and the search for a local conviction

The magnitude of the financial disaster caused by Terra's failure has a human face, that of Do Kwon, which South Korean authorities are unwilling to ignore. During the trial proceedings in the United States, District Judge Paul Engelmayer received and read 315 letters from victims that detailed heartbreaking stories of bankruptcy, including health crises, directly linked to the loss of life savings after the project collapsed. 

In South Korea, the figures are also overwhelming, with authorities estimating that there are around 200.000 local people affected who suffered combined losses of approximately $204 million.

Now the Seoul Southern District Prosecutors' Office has stated its intention to prosecute Kwon for violations of the Capital Markets Act. According to reports According to local media, a conviction under this jurisdiction could add more than 30 years to his prison time, a sentence that would be added to the one already imposed in North American territory. 

The South Korean prosecutors' strategy is based on the premise that a domestic trial is the most effective way to achieve tangible compensation for the affected citizens. Although Kwon legally sought extradition to his native country rather than the United States, he was ultimately sent to New York after his arrest in Montenegro for using a false passport, which complicated his defense.

The plea agreement in the United States opens a procedural window that would allow this double jeopardyDo Kwon could apply to be included in the International Prisoner Transfer Program once he has served half of his US sentence.

Federal prosecutors agreed not to oppose this request, which leaves the door open for Korean justice to take over and apply its own sanctions on the same events, but under a different legal perspective focused on damage to national heritage.

Note: Main image taken from the American publication Wired