U.S. Government Confirms 1 Million People Lost To TerraUSD/Luna
Prosecutors filed criminal charges against Do Kwon, co-founder of Terraform Labs, stating the collapse of the cryptocurrencies TerraUSD/Luna involved over a million people and organizations.
Acting Attorney Daniel Gitner disclosed the estimate in a filing to the U.S. District Court for New York’s Southern District on January 6. He acknowledged that it is difficult to pinpoint the precise number of people impacted by Kwon’s actions amid Terraform’s systemic influence in the space.
The government estimates that there are more than hundreds of thousands of victims in this case, possibly amounting to over a million.
The document described the steps that were to be taken to educate victims about their rights under the Justice for All Act of 2004. The government has proposed setting up a public website to inform victims of case developments since it was impossible to notify each affected individual.
According to the prosecution, Kwon deceived investors by portraying his company as a decentralized financial ecosystem with cutting-edge technologies such as its stock market, savings bank, payment system, and currency.
He was accused of concealing his team’s control by false claims that the Terra ecosystem functioned independently through user governance and blockchain technology. Kwon’s system was based on “lies” and “manipulative and deceptive” tactics, according to the filing, and when the TerraUSD and Luna cryptocurrencies crashed in May 2022, investor losses topped $40 billion.

