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Former Terra CEO Do Kwon Enters Not Guilty Plea In Landmark $40 Billion Crypto Trial

Do Kwon, the South Korean cryptocurrency entrepreneur and co-founder of Terraform Labs, pleaded not guilty on Thursday to a series of criminal fraud charges in a Manhattan federal court. This comes just days after his extradition from Montenegro, where he had been detained for over a year. His case centers around the collapse of TerraUSD and Luna (LUNC), which collectively lost an estimated $40 billion in 2022. Ordered To Remain In Custody Following Court Appearance According to a Reuters report, federal prosecutors unsealed a nine-count indictment accusing Kwon of multiple offenses, including securities fraud, wire fraud, commodities fraud, and conspiracy to commit money laundering. Related Reading: If Solana Reclaims $210 ‘New Highs Are Next’ – Price Analysis Dressed in an olive green long-sleeved shirt and black sweatpants, Kwon appeared in court alongside his lawyer, Andrew Chesley, who indicated that they would not seek bail at this time. Following Kwon’s plea, US Magistrate Judge Robert Lehrburger reportedly ordered him to remain in custody. Do Kwon left the courtroom with a copy of the 79-page indictment, and he is scheduled to return for another hearing on January 8. The Fallout From Do Kwon Alleged Fraud And Market Manipulation In June, Kwon reached a civil settlement with the US Securities and Exchange Commission (SEC), agreeing to pay an $80 million fine and accept a ban from participating in cryptocurrency transactions. This settlement was part of a broader $4.55 billion resolution related to alleged misconduct in the management of Terraform Labs. The indictment details how Kwon allegedly misled investors about the stability of TerraUSD, a stablecoin designed to maintain a value of $1. In May 2021, when the stablecoin’s value began to falter, Kwon reportedly claimed that a computer algorithm known as “Terra Protocol” had successfully restored its peg. In reality, prosecutors allege that Do Kwon orchestrated a scheme involving a high-frequency trading firm to secretly purchase millions of dollars of TerraUSD to artificially inflate its price. Related Reading: Weekly Chart Shows That Dogecoin Price Is Primed To Cross $11 In 2025, Here’s How This reportedly drove both retail and institutional investors to buy Terraform products, significantly boosting the value of Luna, another token linked to TerraUSD, to as high as $50 billion by the spring of 2022. The indictment states, “Much of this growth followed Kwon’s brazen deceptions about Terraform and its technology.” However, the situation took a turn for the worse in May 2022 when TerraUSD’s value began to decline again. The trading firm that had previously propped it up warned Kwon that maintaining its value “wasn’t so simple this time.” The subsequent crash of both TerraUSD and Luna sent shockwaves through the cryptocurrency market, leading to substantial losses for investors and contributing to a broader downturn that affected other digital assets, including Bitcoin (BTC). While prosecutors have not disclosed the identity of the trading firm involved, SEC lawyers previously indicated that Jump Trading had played a role in supporting TerraUSD during its peak in May 2021. Featured image from DALL-E, chart from TradingView.com The Defiant

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US Spot Bitcoin ETFs Near $110 Billion Milestone Amid Bitcoin’s $100K Rally

United States-based spot Bitcoin exchange-traded funds (ETFs) are approaching a major milestone after record-breaking growth in 2024 as Bitcoin crossed the $100,000 price level. US spot Bitcoin ETFs are now just 2.2%, or $2.2 billion, away from surpassing $110 billion in cumulative holdings, representing over 5.7% of Bitcoin’s total supply, according to Dune data. BlackRock, the world’s largest asset manager, leads the US Bitcoin ETF market. Its iShares Bitcoin Trust ETF holds over 542,000 BTC, valued at $51.5 billion, which accounts for 47.9% of the market share among all US Bitcoin ETFs. This positions BlackRock’s fund as the 34th largest ETF globally, spanning both cryptocurrency and traditional financial products, as per ETF Database. The ETFs have been instrumental in Bitcoin’s rally toward $100,000. US spot ETFs drove approximately 75% of new Bitcoin investments, propelling its price past the $50,000 mark by mid-February 2024. Bitcoin to $200K in 2025? BlackRock’s Bitcoin ETF is expected to further institutional adoption in 2025 by simplifying access for large investors, according to Ryan Lee, chief analyst at Bitget Research. “The new ETF milestone and BlackRock’s growing fund could propel Bitcoin to $200,000 during 2025,” Lee told Cointelegraph . “Long-term projections suggest sustained growth, with some forecasts placing Bitcoin’s value at $200,000 by 2025. However, the trajectory will be influenced by regulatory developments, market dynamics, and broader economic conditions,” he added. Currently, Bitcoin must gain another 4.1% to reclaim the $100,000 psychological mark. Bitcoin faces key resistance levels at $97,600 and $99,000. A rally above $99,000 could liquidate over $1 billion worth of leveraged short positions, according to CoinGlass data. The Defiant