34-year-old Do Kwon, a Stanford graduate, scammed clients of $40 billion – more than FTX founder Sam Bankman-Fried and OneCoin co-founder Karl Sebastian Greenwood combined.

A Manhattan federal judge sentenced former cryptocurrency executive Do Kwon to 15 years in prison after determining that the collapse of his $40 billion digital-asset ecosystem in 2022 amounted to a sweeping fraud.

Victims argued that the 34-year-old entrepreneur exploited their trust by presenting an investment that appeared safe but was in fact buoyed by undisclosed cash infusions.

Kwon, a Stanford graduate, pleaded guilty and delivered an apology after hearing victims describe, in person and by phone, the financial and emotional devastation caused by the scheme. One victim, in a letter to the court, recounted contemplating suicide after watching his father lose retirement savings, according to CNN reporting. 

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The losses tied to the collapse of Terraform Labs, a Singapore-based firm Kwon co-founded in 2018, exceeded those in the FTX and OneCoin cases, which ended in the incarceration of Sam Bankman-Fried and Karl Sebastian Greenwood, respectively.

As many as a million victims were affected.

Terraform Labs marketed TerraUSD as a dependable stablecoin whose value would not fluctuate because it was pegged to stable assets. Prosecutors said the product was in reality propped up by outside cash infusions that concealed structural weakness.

When TerraUSD fell far below its intended one-dollar peg, it set off a chain reaction that devastated holders of both TerraUSD and its related token Luna and sent shockwaves throughout crypto markets.

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Kwon attempted to rebuild the company in Singapore before fleeing to the Balkans on a fake passport. He was detained in March 2023 in Montenegro and spent 17 months in a prison there prior to his extradition to the United States.

As part of his plea deal, which slashed the detention term from 25 to 15 years, Kwon agreed to forfeit more than $19 million. He also faces fraud charges in in South Korea, where his family resides.