cryptonewsz.com
Do Kwon, the co-founder of Terraform Labs, is set to go on trial in New York in January 2026 for fraud allegations linked to the $40 billion TerraUSD stablecoin crash in 2022. According to reports, the trial will commence on January 26 and is projected to run for four to eight weeks.
A Look At Terra founder Do Kwon’s Case
U.S. District Judge Paul Engelmayer of the Southern District of New York is presiding over the case, according to a Bloomberg report. Kwon, who has denied the charges, was extradited to the United States after a two-year legal battle that began with his arrest in 2023. He was detained in Montenegro for attempting to leave the country using forged documents.
Despite South Korea’s outstanding charges against him, Montenegrin authorities prioritized extraditing Kwon to the U.S. The TerraUSD collapse marked a significant moment in the crypto world, destabilizing the industry and leading to a chain reaction of failures, including the high-profile collapse of FTX. Kwon reportedly controlled 92% of the Terra ecosystem, which amplified the impact of its downfall.
This case will be heard in the same courtroom where FTX founder Sam Bankman-Fried faced charges. Bankman-Fried was convicted in November 2023 and sentenced to 25 years in prison for his role in FTX’s failure.
Kwon’s arrest and subsequent legal proceedings have drawn global attention, especially as regulators and law enforcement agencies intensify scrutiny of crypto platforms. His trial is anticipated to be a defining moment for the industry, shedding light on the regulatory gaps and potential risks in the crypto ecosystem. This case is listed as US v. Kwon, 23-cr-0151, in the Southern District of New York.