CNBC Reports Terra Founder May Not Go To Prison For LUNA And UST Crash

Is Terra’s Do Kwon Going To Jail, Or Will He Pay Up? What Are The Options?

Recently, Terra Luna’s issues have been a significant subject of discussion on crypto streets. Over the last few days, founder Do Kwon and his company, Terraform Labs, have been mentioned in various scandalous allegations linked to the recent collapse of the Terra ecosystem following the price crash of LUNA and UST.

As the allegations pile up, speculations are abounding on whether Do Kwon, who apparently owns over 90% of Terraform Labs, could be legally liable for the economic damages that befell Terra investors.

There are already reports that he and his company are under intense investigation by a team of elite anti-fraud government agents in South Korea. The debate is now hot on whether Kwon could get prison time if things go south for him.

This Was His Second Failure

For starters, it’s now in the public domain that the collapse of Terra Luna and UST is not Kwon’s first failure in the crypto space. It has been revealed that he was behind yet another collapsed stablecoin project named Basis Cash a few years ago.

Interestingly, right after the collapse of Terra, Do Kwon proposed to create yet another project named Terra 2.0. The new blockchain went live on May 27, and then a faulty airdrop operation followed.

These successive failures have threatened to erode people’s confidence in the blockchain and crypto technologies. Not to mention that Terra’s crash affected the entire crypto market, including top coins like Bitcoin and Ethereum.

Fines Or Time In Prison?

So, following the back-to-back exposes and a number of investigations facing Do Kwon and his company, could he end up in prison?

CNBC reports that criminal charges in a market-related incident are hard to prove in a court of law because there’s no metric or technology to assess a person’s intent on the go. For example, being an evil CEO in the US and making decisions that lead to losses doesn’t amount to criminal conduct.

Randal Eliason, an assistant US Attorney, told CNBC:

“It’s not like a homicide where you bring witnesses to testify to who pulled the trigger. We’re trying to prove what was going on in someone’s mind.

That’s often a very painstaking process that involves reviewing lots and lots of documents, and talking to many, many people and dealing with all their lawyers through that process, and scheduling grand jury time and court appearances.

It can really drag on, so no one should expect anything to happen overnight.”

Civil Case Possible

However, a civil case could sail through and have Do Kwon pay fines and compensations to the victims. To prove such a case would have a lower evidential thresh-hold than proving a criminal case involving prison time.

A group of South Koreans who lost money during the Terra crash is already pursuing this option against Kwon. He’s also facing taxation demands from the South Korean tax authorities.