Do Kwon Faces December Sentencing as Prosecutors Push for Maximum Term

Do Kwon, the embattled co-founder of Terraform Labs, is set to be sentenced on December 11, 2025, in Manhattan federal court, where Judge Paul Engelmayer will determine his prison term. U.S. prosecutors are urging the court to impose the toughest sentence allowed under his plea deal, arguing that Kwon’s actions contributed to one of the most disruptive collapses in crypto history. They emphasized that the scale of his fraud extended far beyond a single failed project, sending shockwaves through digital asset markets and inflicting heavy losses on retail investors, lenders, and trading platforms.

Kwon pleaded guilty in August 2025 to conspiracy to commit commodities fraud, securities fraud, and wire fraud, along with an additional wire fraud count. While the combined charges carry a potential maximum of 25 years in prison, his plea agreement caps the prosecution’s request at 12 years — a sentence they are now firmly pursuing. Prosecutors allege that Kwon repeatedly misled investors about key aspects of the Terra ecosystem, fueling confidence in the platform before the dramatic 2022 crash of TerraUSD and Luna, a downfall widely estimated at around $40 billion.

Kwon, however, is seeking a significantly lighter sentence. In a recent filing, he argued that a five-year term would be appropriate, setting the stage for a contentious sentencing phase as both sides present sharply opposing views of his culpability and the damage caused.

Under the plea terms, Kwon must forfeit over $19 million in proceeds tied to Terraform Labs and its digital assets. Prosecutors have opted not to pursue restitution, claiming that calculating losses across millions of global victims would be nearly impossible.

Kwon’s case reached U.S. courts after a lengthy international pursuit. He was arrested in March 2023 in Montenegro while attempting to travel to Dubai using forged documents, prompting competing extradition efforts from both the United States and South Korea.