Launched a cryptocurrency that suffered losses of $40 billion and is now facing more than 100 years in prison.
This happened in 2022 and was a warning for what would happen in the financial ecosystem of cryptocurrencies.
Context.
In 2022, one of the first collapses of the crypto ecosystem occurred when 'Luna' collapsed, dragging down the entire Terra project. The CEO of it all was Do Kwon, a South Korean from Seoul. This crisis caused savers and those betting on this cryptocurrency to lose a total of 40 billion dollars.
In January 2018, Do Kwon founded Terraform Labs alongside South Korean entrepreneur Daniel Shin. Following the footsteps of Basis Cash, both entrepreneurs proposed the development of a payment protocol capable of integrating multiple algorithmic stablecoins, as well as other tokens, while offering high processing and interaction speed.
By 2019, they had already received investments of 150 million dollars from companies such as Galaxy Digital, Pantera Capital, Binance, Huobi, and OKX. In 2020, the dollar-pegged stablecoin made its market debut, Terra UST.
The fall of Terra began in 2022, a period characterized by a general downward trend across the entire cryptocurrency market. The Terra project inaugurated the bad streak in the ecosystem when in April of that year its stablecoin UST lost parity with the dollar.
