Crypto fraudster sentenced for 'epic' $40bn stablecoin crash
Source: BBC
A former crypto entrepreneur who was behind two digital currencies that collapsed and lost an estimated $40bn (£29.9bn) has been sentenced by a New York judge to 15 years in prison for an "epic" fraud.
Do Kwon, a South Korean national, was co-founder of Singapore-based Terraform Labs, which developed the TerraUSD and Luna digital coins.
Kwon had admitted misleading investors about TerraUSD, a so-called stablecoin that was supposed to maintain its value against the US dollar.
He was one of a number of crypto bosses to face charges in the US after digital tokens slumped in 2022, triggering the failure of several companies.
Read more: https://www.bbc.co.uk/news/articles/ckgmm92d213o
A Federal court, so there's the inevitable bribed pardon coming up - being Korean, he'll have to pay a bit more.
MissouriDem47
(392 posts)Like Santa Claus a pardon is on it's way, when TACO is given enough cash. It won't be a bribe, it will be a Christmas present.
Squaredeal
(706 posts)Dont ever tell me again that we, as the wealthiest nation in this world, cant afford to support Social Security or Universal Healthcare for all our citizens because we dont believe you. For the super rich, it has become Monopoly money to see who can accumulate the most to win the game. Its way overdue bringing back the top 90% tax bracket like America had back in the 50s when we didnt have this nonsense as a nation. That personal wealth was reserved for the third world countries then, when there were two classes of citizens: the few havesand then everyone else, the have nots and little justice for those without money.
With their walled-in, guarded compounds and estates they dont have to encounter the sufferings of their fellow citizens with their delicate eyes.
Dont worry or feel sorry for them. Theyll still have piles of cash to keep and to play with, for themselves, for their kids and for their kids kids, as the rest of us keep them safe and secure in their own world. Its a small price for them to pay for it.
FakeNoose
(40,005 posts)BOSSHOG
(44,604 posts)The latest redundancy. Similar to immoral Republican.
NoMoreRepugs
(11,779 posts)mwooldri
(10,783 posts)Bengus81
(9,758 posts)Fat Hitler doesn't intervene. But this is a easy and simple cash grab for Trump. I'd say an asking price of at least $500M for that fraudsters freedom.
lonely bird
(2,710 posts)Stable against the dollar? Crypto is a commodity and as such is subject to extreme ups and downs. Anyone who thought that a crypto would be stable against the dollar is a fool.
muriel_volestrangler
(105,496 posts)have commonality and differences with other crypto assets (unbacked crypto assets). Like unbacked crypto
assets, they are issued on distributed ledgers, typically blockchains. Unlike unbacked crypto assets, they are
generally issued and operated in a centralized manner by entities such as crypto firms or financial institutions,
which aim to maintain a fixed parity relative to a specific currency, and have backing assets. Indeed, stablecoin
issuers usually back the stablecoins in circulation 1:1 with short-term, liquid financial assets. The large majority
of currently existing stablecoins is denominated in United States dollars.
Stablecoins are currently mostly used for crypto trades, although they have the potential to be used in other
payment transactions. Stablecoin issuance has doubled over the past two years, driven by their use in crypto
tradesacting as a bridge between volatile unbacked crypto assets and fiat currenciesalbeit with an
expansion in use cases to include cross-border payments. The future demand for stablecoins could arise from
other use caseslike use in domestic paymentsbuilding on greater incentives and confidence provided by
enabling legal and regulatory frameworks. Estimates on stablecoins future growth vary widely.
https://www.imf.org/-/media/files/publications/dp/2025/english/usea.pdf
They stay stable - until they don't (which could be because of a market crash, or because of fraud). They're also being used as a "camel's nose in the tent" by crypto boosters - "hey, you can trust this, it's pegged to the dollar, so it must be just as safe, so what's there to worry about for crypto in general?"
lonely bird
(2,710 posts)Only fraud, money laundering just for starters.
Just because some guy has an idea doesnt make it a good one.
Come to think of it, financial innovation always fucks up. See Minsky.