I key until today (August 12, 2025)
Criminal situation in the U.S.
Kwon was extradited to the United States from Montenegro in late 2024 and appeared in New York in early 2025.
Today, the judicial press reports that he will change his plea to "guilty" in the federal criminal case for the collapse of UST/LUNA (noted as ~40,000 M$ in losses). Hearing scheduled for today, Tuesday at 10:30 a.m. ET in Manhattan. (This is a change from his "not guilty" plea in January).
Civil process and bankruptcy
In 2024, a jury determined civil liability for fraud for Terraform Labs and Kwon against the SEC; then a total payment of ~4.47 billion $ (coordinated with the Chapter 11 liquidation) was agreed upon. Terraform is in the process of liquidation approved by the bankruptcy judge (Delaware).
Brief timeline
May 2022: UST loses parity; LUNA collapses.
Mar 2023: Kwon is detained in Montenegro for false passports.
Dec 2024 / Jan 2025: Extradition and first appearance in the U.S.; pleads not guilty.
Aug 2025: Signal of imminent plea agreement in the criminal case.
What could play in his favor?
Plea agreement and cooperation: a plea change usually comes with concessions on sentencing (if he cooperates, accepts facts, and facilitates asset recovery). The scope of the agreement is still unknown.
Time already served: he spent months detained in Montenegro (for false documents) and has been in custody in the U.S. for ~7 months; this usually counts towards the sentence calculation.
Restitution framework: the bankruptcy/SEC framework for paying victims may be considered in sentencing (though it does not eliminate criminal liability).
What plays against him?
Nine federal charges (securities fraud, commodities fraud, electronic fraud, money laundering, etc.).
Magnitude of the damage (~40,000 M$) and findings from the SEC civil case.
Prior conduct (fleeing, false passports in 2023).
When is he "free"?
No sentencing date has been published yet. If he changes the plea today, the judge usually sets the sentencing months later.
