Jun 6, 2022
Honestly, did Do Kwon do anything illegal?
By now you would probably have heard of the collapse of Terra / Luna and the shockwaves it created in the crypto world.
Even your aunt and grab driver would probably be chattering about it.
$45B was wiped out when TerraUSD, the algorithmic stablecoin created by Terraform Labs (which was founded by Do Kwon), crashed after an “attack” caused it to depeg.
In total, $83B exited from the decentralised finance space in web3 within the month of May, largely attributed to Terra’s fallout.
It is a devastating blow not only to Terra, but to Do Kwon personally and also the whole crypto ecosystem in general too.
Another uppercut that came from the dark and hit crypto squarely in the jaw.
Only this time, the writings were probably written on the walls.
For months leading up the demise of Terra/Luna, people were challenging the sustainability and integrity of the algorithmically backed stablecoin which didn’t have reserves backing its value.
Crypto influencers on Twitter opened fire at Do Kwon and he fiercely retorted back, sometimes with pure arrogance and disdain.
Sometimes its comical, sometimes it just sounded plain rude.
Over time, it really seemed that Terra’s insane celerity to popularity was getting to his head, clouding his objectivity and vision.
Terra’s collapse was like a nuclear detonation in the crypto world.
It not only affected those directly tied to Terra/Luna, it also has rippling effects on other chains, startups, businesses, protocols, layers that were built on top of it.
Like a house of cards, when a single card is displaced at the foundation level, every other card will fall subsequently, and often, rapidly.
“What Kwon did was very bad. But that doesn’t necessarily mean it was against the law. People do terrible things every day — such as refusing to help a drowning puppy or behaving cruelly to a grandparent — but, for one reason or another, those acts are not considered to be criminal.”
Questions have to be asked:
Did Do Kwon do anything wrong?
Did he break the law in any way?
Should he be thrown into prison?
Is there is a case to prosecute him in court?
Were there evidence of fraud or a Ponzi scheme?
Did Do Kwon set out to intentionally cheat clients?
“According to Randall Eliason, a law professor and former prosecutor who specializes in white collar crime, any criminal case would have to show that Kwon committed fraud as opposed to engaging in reckless mismanagement — a task that is rarely easy.”
It is so much more complicated than we think.
Proving if he was intentional about defrauding investors and having the intent to cheat his client’s money is very complex.
Nobody could prove definitively that Do Kwon personally made wealth from the collapse.
So before we throw our fists in the air and accuse Do kwon of scam and fraud, keep in mind that no one went to prison for the countless of reckless decisions that led to the 2008 financial crisis.
Well, I believe more details and behind the scenes information will be released soon.
The whistle-blower FatManTerra has gained nearly 50K followers ever since releasing previously unheard of backend dealings and details of Do Kwon and his investors.
Juicy.
Truth is, at least on the surface, Do Kwon didn’t do anything outrightly illegal.
Everything was legit, transparent and openly laid out for anyone who wanted to buy Terra/Luna.
There was no overt intention to scam or cheat anyone.
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When the protocol did what it was supposed to do, everyone was making so much money, nobody bothered to ask the hard questions.
So again, what Do Kwon did was perhaps reckless, inane and wrong, but was it illegal and did it break any law?
That’s a tough situation we as a community got to figure out as we continue navigating this journey through cryptoland.
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Should Do Kwon go to prison?
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