Photo: TY Lim / Shutterstock.com
The crypto market is reacting strongly to new developments in the legal case against Do Kwon, the founder of the collapsed Terra ecosystem. While U.S. prosecutors recommend a 12-year prison sentence, both Terra Classic (LUNC) and Terra 2.0 (LUNA) are posting significant gains. On Bitvavo, the tokens are even among the top-performing coins of the day, ranking 4th and 8th respectively.
Background: U.S. Prosecutors Go on the Offensive #
According to a new court filing submitted on December 4, the U.S. Department of Justice is seeking a heavy sentence. Prosecutors claim that Do Kwon, with Terraform Labs, caused greater financial damage than Sam Bankman-Fried, Alex Mashinsky, and OneCoin founder Karl Sebastian Greenwood combined. The officials hold Kwon responsible for billions in losses that ultimately contributed to the so-called ‘Crypto Winter.’ The verdict is scheduled for December 11, 2025.
Kwon previously pleaded guilty to multiple charges, including wire fraud, conspiracy, and market manipulation. His lawyers are advocating for a maximum of five years, partly because he faces up to forty years in prison if extradited to South Korea.
Terra Classic and Terra 2.0 Prices Explode #
According to data from Bitvavo:
Terra Classic (LUNC):
- +70.36% in 24 hours
- +119.61% in 7 days
- Trading volume: €12.16 million
- Price: €0.000054093
Terra 2.0 (LUNA):
- +37.46% in 24 hours
- +47.43% in 7 days
- Trading volume: €2.71 million
- Price: €0.093750
With these gains, both tokens are among the strongest performers on the trading platform. The market is thus reacting extremely volatile to the combination of legal clarity and speculative hope for future recovery.
Why Are the Prices Rising? #
- Speculation on case resolution: as legal uncertainty decreases, traders often anticipate volatility.
- Reassessment of ecosystems: some investors see potential in community-led management of LUNC.
- Short-term trading: strong price movements attract high volumes, further increasing volatility.
Importantly, no fundamental upgrade, partnership, or technological breakthrough has been announced. The rise therefore appears to be driven primarily by market sentiment.
Caveat: Major Uncertainty Remains #
Despite the explosive price movements, the risk remains extremely high. The Terra case is not yet concluded, and the final verdict could impose additional financial claims or restrictions. Moreover, LUNA remains far from its historical highs: before the collapse in May 2022, the coin once traded above $19, compared to just $0.09 today.
The coming week will be crucial for the Terra ecosystem. With the upcoming verdict in the U.S. and potential prosecution in South Korea, Do Kwon faces an exceptionally heavy legal future. Investors continue to speculate on price fluctuations, but official clarity on the impact on Terra itself is still pending.